Oral Answers to Questions

WALES

The Secretary of State was asked—

Employment

Hywel Francis: What recent assessment he has made of employment trends in Wales; and if he will make a statement.

Paul Murphy: Employment in Wales continues to be at historically high levels, with 122,000 people now in work in Wales, and unemployment down by 30 per cent. since 1997.

Hywel Francis: Employment prospects in my constituency, Aberavon, have been significantly strengthened as a result of the recent announcement of £71 million worth of investment in the Port Talbot Corus steel plant and the Tata acquisition of Jaguar and Land Rover. Will the Secretary of State join me in welcoming these developments, particularly the investment in environmental improvement, which will strongly support the excellent Neath Port Talbot council's clean air charter? Will he also consider an early visit to my constituency to meet the new managing director of the Corus steel plant, Mr. Chaturvedi, to discuss future employment prospects in the Welsh steel industry?

Paul Murphy: Yes, I should be delighted to visit my hon. Friend's constituency and to show support for his excellent local authority and the initiative that it has taken, involving all sections of the community in maintaining high standards of air quality. May I say how good it is that Tata has invested £9 million at Morfa in his constituency and £60 million in Port Talbot? If that is not a huge vote of confidence in Wales, I do not know what is.

Stephen Crabb: The question on the Order Paper asks for a recent assessment of employment trends. The Minister should be aware that the most recent data from the Office for National Statistics show that the employment rate in Wales has fallen to just 71.5 per cent. and the economically inactive rate has risen to almost 25 per cent. What does the Secretary of State think might be responsible for the dreadful recent rise in worklessness in Wales? Is it the policies of his sclerotic Government here in Westminster, or those of his separatist colleagues in Cardiff?

Paul Murphy: The hon. Gentleman really should remember what unemployment was like when the Conservatives were in control: we had 3 million people out of work when I came into the House. The figures that I have just given are figures of considerable significance. In his constituency, Preseli Pembrokeshire, for example, there has been a 73 per cent. drop in unemployment since February 1997. The figures speak for themselves.

Nick Ainger: My right hon. Friend will recall his visit to the new Bluestone project in my constituency which, when all its phases are completed, will employ 600 local people. Does he agree that that is evidence of the success that comes from partnership between the private sector and the public sector in the shape of the Welsh Assembly Government, who have also made a substantial investment in what will be a high quality leisure project employing substantial numbers of people and, most importantly, providing full-time all-year-round work in the tourist sector?

Paul Murphy: Yes, I was delighted to visit Bluestone in my hon. Friend's constituency. It is a great project and he is right to point out the importance of the Welsh Assembly Government's contribution to what will be a major tourist attraction for Wales and a major employer for Pembrokeshire. I am also pleased to point out that my hon. Friend represents the other half of Pembrokeshire, where employment has unquestionably improved over recent years. In his constituency there has been a 71 per cent. reduction in unemployment since February 1997. What a success story for west Wales.

Roger Williams: In terms of employment, the public sector is very important in Wales, yet within the space of three weeks Her Majesty's Revenue and Customs has broken faith with its employees in Merthyr by announcing further cuts in employment and transferring more jobs to Cardiff. That will have a knock-on effect in Brecon, where the branch is to close in 2011 and many of the employees wished to transfer to Merthyr. How can the staff and customers of HMRC have any faith in its plans when they are changed on such a short-term and arbitrary basis? Will the Secretary of State intervene on behalf of the staff and the public?

Paul Murphy: I understand and sympathise with the points that the hon. Gentleman makes with regard to HMRC. As he knows, I have an HMRC office in my constituency, and I understand the importance of employment, particularly in what used to be called objective 1 areas and are now convergence fund areas. Certainly, I will continue discussing the matter with the relevant Ministers in the Treasury. The hon. Gentleman will understand, though, that over recent years well over 3,000 jobs in the public sector have come to Wales. That is important not just for the areas that he and I represent, but all over Wales.

Dai Havard: It was expected that the office in Merthyr would remain in its current form until 2011. My concern, which I would like my right hon. Friend to express to his colleagues in Government and see how he can assist, is about how the consultation has been carried out. The expectation has now been changed in an arbitrary fashion, without the necessary consultation. I would like my right hon. Friend to assist, if he can, in trying to rectify that position.

Paul Murphy: I understand my hon. Friend's position. He can rest assured that I will put his points to my colleagues at the Treasury.

Cheryl Gillan: The Secretary of State must be worried that Welsh employment trends are showing a drop of more than 1 per cent. last year. Our military trained strength is also falling, by 3 per cent. this year. More than ever, we need Welsh men and women in our armed services. Will the Secretary of State join me in condemning the National Union of Teachers' decision on excluding armed forces personnel from visiting our schools? That will prevent our young people from getting early information about potential employment in the services. Furthermore, will he ensure that that wicked policy is not implemented in Welsh schools?

Paul Murphy: My hon. Friend the Under-Secretary of State is visiting Ministry of Defence establishments throughout Wales; I am sure that he will be able to carry the important message that the opportunities that the armed forces present to our young people in Wales are taken up. The hon. Lady can rest assured that we will make those points strongly; my hon. Friend will certainly do so.

Regional Pay

Nia Griffith: What discussions he has had with Cabinet colleagues on the potential effects of introducing regional pay arrangements in Government agencies and services in Wales.

Huw Irranca-Davies: My right hon. Friend the Secretary of State and I have regular meetings with ministerial colleagues to discuss matters of such importance to Wales. We need to give careful consideration to all the potential effects of regional pay to ensure that our pay policy promotes economic growth in all parts of the UK.

Nia Griffith: My hon. Friend will be aware that after the decline in the coal and steel industries in the '80s, we are at long last beginning to see the benefits of regeneration and growth in the local economy, and we need to do everything we can to keep that momentum going. Will the Under-Secretary agree to meet me to discuss the detrimental effect that regional pay could have on employees and the economy in general in my constituency?

Huw Irranca-Davies: My hon. Friend makes important points. On my recent ministerial visits to her constituency, I have seen the work that she has done to promote jobs in the local economy. The Secretary of State for Wales discussed the issue of regional pay at a recent meeting with the Lord Chancellor, and my right hon. Friend and I will continue to raise Members' concerns about that issue. In response to my hon. Friend's request, I should say that we will be more than happy to meet her and other colleagues who wish to raise the issue with us.

Elfyn Llwyd: The convergence fund areas are there for a purpose: to raise the gross domestic product within those areas. Yet regional pay policy will depress salaries in those areas. Which is it going to be? Is it not time for some joined-up thinking? I know that the Secretary of State has made representations, but I agree entirely with the hon. Member for Llanelli (Nia Griffith). We need to redouble our efforts on the issue, because it could be very detrimental to many areas of Wales.

Huw Irranca-Davies: I am pleased that the hon. Gentleman recognises the representations that we have already made, and we will continue to make them. The civil service currently has regional flexibility in its pay systems, and the Department for Work and Pensions has four separate pay zones. However, that Department, for example, has no plans whatever to introduce low-level regional pay for Wales.
	In the wider context, the key is to address, foster and encourage the development of a strong private sector as well, with well paid jobs in Wales, so that the pay arrangements reflect the wider labour market fundamentals for the work force—not least, recruitment and retention. None the less, we will continue to take these issues up and make representations.

Julie Morgan: Rather than bringing in regional pay for some civil service jobs in Wales, would it not be more sensible for the UK Government to move even more civil service jobs to Wales, and thus help fill the empty floors in the Llanishen tax office in my constituency?

Huw Irranca-Davies: My hon. Friend raises an important point about the reallocation of public sector jobs to Wales. Although the current issues are controversial, it is worth remembering, as I am sure my hon. Friend does, that more than 3,259 jobs have been relocated to Wales from central areas of England. We are the third highest receiving area in the whole of the UK for public sector jobs, thanks to that relocation. However, my hon. Friend makes a fair and valid point, and my right hon. Friend the Secretary of State and I will continue to listen to the concerns expressed and make representations as appropriate.

Cross-Border Patients

Peter Bone: What recent discussions he has had with the First Minister on hospital waiting times for cross-border in-patients.

Huw Irranca-Davies: I am aware of the hon. Gentleman's continued interest in this issue over some time. I can tell him that my right hon. Friend and I regularly meet the First Minister and the Minister for Health and Social Services to discuss a range of issues, including hospital waiting times, for cross-border patients. The Assembly Government are investing record amounts in the NHS in Wales and are consistently delivering real improvements in the standard of health care for all patients.

Peter Bone: Prime Minister Blair told us on 30 November that nobody was waiting more than six months for an NHS in-patient operation. Today, 2,788 Welsh patients and 239 cross-border patients are waiting more than six months. Why have things deteriorated so much under the current Prime Minister?

Huw Irranca-Davies: Actually, I can correct the hon. Gentleman slightly—there is improvement, not deterioration. The latest figures, for February 2008, show that in the last year alone the number of Welsh patients waiting for in-patient or day-case treatment in an English hospital has dropped by more than 22 per cent. and that the number of Welsh patients waiting for up to 36 weeks for an out-patient appointment in an English hospital has dropped by nearly 20 per cent. We appreciate that there is more work to do, but we are heading in the right direction.

Albert Owen: On Monday, the Welsh Affairs Committee visited the Walton centre and Alder Hey in Liverpool as part of our ongoing inquiry into cross-border health services. Those two establishments are centres of excellence and an integral part of the national health service for the people of north Wales. We were told that for all serious illnesses patients were treated equally whichever side of the border they resided on. Does the Minister agree that to meet the expectations of the future we need to strengthen the links between general hospitals in north Wales and those centres of excellence to ensure that we get the best patient care, based on clinical need, not geography?

Huw Irranca-Davies: My hon. Friend and other colleagues in north Wales have made strong representations on this issue. My right hon. Friend and I are convinced that the outcome of the ongoing review, which I understand will report in July this year, should arrive at a sensible and measured approach that delivers for patients in north Wales, and throughout Wales and the region. That is what we are looking for. I am assured that no decision has yet been made on the future of neurosurgery, but we do listen, and I am sure that my hon. Friend, too, makes those representations directly to Welsh Assembly Government Ministers.

Hywel Williams: But will the Minister join me in condemning those who would worry, perplex and even frighten sick people in Wales with their exaggerated and sometimes unfounded allegations about problems with cross-border services—not because of concern for the health of our people, but as a proxy for their opposition to devolution?

Huw Irranca-Davies: All people in this House, and elsewhere, would want to ensure that decisions on health care are reached democratically and in the interests of the patient, and that is best done in a mood of calm, considered, deliberate attention to detail. That is how we would want things to proceed. If there is scaremongering, we would all, in this House and elsewhere, urge people to desist from that and look at the situation rationally.

Ian Lucas: Does my hon. Friend agree that it is extremely important that Welsh MPs should be entitled to ask questions about the treatment of patients in England, and will he reject absolutely the Tory proposal to stop us doing so?

Huw Irranca-Davies: I do indeed agree. My hon. Friend makes a point about the role of Welsh MPs and their power to represent their constituents in this place in all matters. People will still come through to all MPs' advice surgeries to raise these issues. We have democratically elected institutions both here and in the National Assembly for Wales, and it is important that the voices are heard in both places.

Lembit �pik: My constituents are often told that because they live in Wales, they have to wait longer than the English patients of Shropshire hospitals. It is not hard to imagine the frustration and suffering that that causes my constituents. What can the Minister do to ensure that Montgomeryshire folk with health problems are not made to feel like second-class citizens when they go to those hospitals? How can he ensure that we get parity of treatment across the border between Montgomeryshire and England?

Huw Irranca-Davies: I know that the hon. Gentleman is a strong supporter of devolution in principle, and one of the outcomes of devolution is that different approaches to primary, secondary and acute care will be adopted. In this House and elsewhere, we all want to see the best treatment for all our patients, and we are heading in the right direction. I hear the hon. Gentleman's concerns, however, and other Members have expressed them as well. We want waiting times to come down, but we also want to see the massive investment that Labour has put into health, in primary care and elsewhere, paying dividends, and that process is working under this Government.

David Jones: As of yesterday, the combined target waiting time for out-patient and in-patient treatment in England has been reduced to 18 weeks, whereas in Wales the equivalent target is 44 weeks. Given that the Assembly Government spend more on health than England, one might have thought that the reverse would be the case. Could the Minister explain why the Assembly Government have apparently made a policy decision to require Welsh patients to wait more than twice as long for treatment as English patients?

Huw Irranca-Davies: The policy decision of the Welsh Assembly Government is to invest in health care, including waiting times, which are falling. As of January 2008, only three patients were waiting more than 36 weeks for in-patient or day-case treatment, compared with 3,485 in January 2007. We are not complacent, and we know that we have to go further, but the difference between 3,400 patients waiting and three waiting is evidence that we are going in the right direction.

Prisons

Henry Bellingham: When he next expects to meet governors of prisons in Wales to discuss combating drugs in prisons.

Huw Irranca-Davies: My right hon. Friend and I have regular discussions with ministerial colleagues and others on a range of offender management issues, as well as on prisons in Wales.

Henry Bellingham: Why are there so many drugs in prisons, and why is it that a number of young offenders in Wales enter prison as mild drug users, but come out as hardened addicts? Is it not a disgrace that some wings in prisons, including prisons in Wales, have been designated drug-free wings? Surely that is a dreadful indictment of Ministers, because every wing of every prison should be drug-free.

Huw Irranca-Davies: I assume that the hon. Gentleman has visited some of the prisons in Wales, as I have, and seen some of the drug-free wings that he talks about, where the policy is clearly to encourage and work with prisoners who have made a clear decision to give up entirely on drugs, and to make sure that they do not take them. That policy is working: 8.6 per cent. of mandatory drug tests in prisons gave positive results in 2006-07, compared with 20 per cent. 10 years ago. The rate of those testing positive for the use of opiates has fallen by more than 25 per cent. in the past 10 years. Yes, there is more to do and we are working on that, but our investment in drugs treatment in prisons is working, whereas before there was failure.

Paul Flynn: The reason we have drug-free wings in prison is that we do not have any drug-free prisons. Is it not a continuing disgrace that under Governments of both parties we have never been able to control drugs in prisons? The tragedy that continues these days is that people who go in as users and come out clean, who are put down as successes for the prison system, often die very quickly. Two of my constituents came out of prison drug-free: one lived a week, and another lived a day.

Huw Irranca-Davies: My hon. Friend makes an important point not only about rehabilitation and drug treatment in prisons, but about the aftercare of people who come out into the community and the treatment that is made available to them. He will welcome, as I do, the more than 7,500 drug treatment programmes completed in prisons in England and Wales in 2006-07. That figure is 30 per cent. above the target, so we are doing the right things and heading in the right direction, but we recognise, as always, that we need to do more.

Cheryl Gillan: The Minister is complacent. I think that things will get worse in Wales, because more than 58 per cent. of women prisoners have drug addictions, the reoffending rate among women is now 60 per cent., and there are no women's prisons in Wales, so they are treated on programmes through English primary care trusts. Given the growing differences between the English and Welsh health systems and the poverty of supply of drug rehabilitation places, how can we ensure the continuity of drugs programmes and support on release for women prisoners returning home to Wales?

Huw Irranca-Davies: Support for women prisoners is a real issue, especially following Baroness Corston's review. We await decisions from the overall Prison Service about what will be brought forward. However, I have already highlighted the fact that although there is more work to do, our investment in drug treatment in prisons is paying dividends. We will continue to drive down the use of drugs in prison and to promote the aftercare of prisoners when they go into the community.

Neighbourhood Policing

Chris Ruane: What recent discussions he has had with the Secretary of State for the Home Department on neighbourhood policing in Wales.

Paul Murphy: I have regular discussions with ministerial colleagues, chief constables and others on law and order issues in Wales, including policing. I welcome the fact that, from 31 March, Welsh communities are fully covered by neighbourhood policing teams. That achievement follows three years of hard work by forces, police authorities and local communities.

Chris Ruane: I thank my right hon. Friend for that reply. Will he join me in congratulating the Denbighshire crime and disorder reduction partnership, which, of the 376 partnerships in England and Wales, came out as the third best? Will he also join me in recognising the leadership of Divisional Commander Michelle Williams and Denbighshire's Roly Schwarz in helping to achieve those fantastic results?

Paul Murphy: I send my best wishes to the officers concerned. Denbighshire community safety partnership is one of the best in England and Wales, and has the third best crime reduction figures over the past three years. It is a great story for Denbighshire and Wales.

David Davies: Does the Secretary of State agree that neighbourhood policing may well succeed because the Home Office has rolled it out throughout the United Kingdom? Will he resist any calls from Members of the Welsh Assembly to take control of policing, which would be a disaster for law and order in Wales?

Paul Murphy: I agree that the Home Office's work has achieved excellent results. The hon. Gentleman can rest assured that the future of justice and policing will remain with the United Kingdom Government and Parliament.

Climate Change

John Robertson: What discussions he has had with the First Minister on the consequences of climate change for Wales.

Huw Irranca-Davies: The Secretary of State has regular discussions with the First Minister on a range of issues, including the vital subject of climate change.

John Robertson: My hon. Friend will realise that our commitment on climate change and to low-carbon energy is important. As Chairman of the all-party group on nuclear energy, I hope that two sites in Wales will bid for new nuclear facilities. Will my right hon. Friend assure me that, in his discussions with the First Minister, he will not experience the sort of problems that we did in Scotland with the Scottish National party?

Huw Irranca-Davies: I congratulate my hon. Friend on his tireless advocacy of nuclear power as part of the solution. Certainly, the Secretary of State recently met my hon. Friend the Member for Ynys Mn (Albert Owen) and representatives of Wylfa power station to discuss the future of the site, not only in its current form but in the context of any proposed new build. I assure my hon. Friend that the Wales Office remains fully supportive of new build at Wylfa and will continue to meet parties who are serious about making that happen.

Adam Price: The Welsh Assembly Government and the UK Government have jointly launched a feasibility study on the idea of a Severn barrage. Will the Minister confirm that any decision on that report will also be jointly made between the Welsh and UK Governments?

Huw Irranca-Davies: At all timesin the discussions on the Severn barrage and the report of the Sustainable Development Commissionthere has been close dialogue and communication between the Welsh Assembly Government and the lead Department. I have no doubt that that will continue. It is worth pointing out that whatever option is pursued, the Severn barrage is unique in that it could save up to 3 per cent. of total UK carbon emissions and produce up to 5 per cent. of UK energy for the foreseeable future.

A  E Departments (Policing)

Alun Michael: When he last discussed the provision of police resources to cover accident and emergency departments in Wales with the Secretary of State for the Home Department; and if he will make a statement.

Paul Murphy: I have regular discussions with Home Office Ministers, chief constables and others in respect of policing issues in Wales.

Alun Michael: Will my right hon. Friend take the opportunity, when he next speaks to the Home Secretary, to draw to her attention the benefits of the violence reduction programme in Cardiff, which is led by a distinguished medic, Professor Jon Shepherd? The programme has already been drawn to the attention of the Secretary of State for Health, who is taking an interest. Will my right hon. Friend promote co-operation between the health service and the police service to reduce violence, not just in Cardiff but throughout the country?

Paul Murphy: Yes, I can assure my right hon. Friend that I will pass that message on to my right hon. Friend the Home Secretary, and tell her about the good work done by Professor Shepherd.

PRIME MINISTER

The Prime Minister was asked

Engagements

Eric Joyce: If he will list his official engagements for Wednesday 2 April.

Harriet Harman: I have been asked to reply.
	Before listing my right hon. Friend the Prime Minister's engagements, I am sure that the whole House will wish to join me in sending our profound condolences to the family and friends of the two Royal Marines who were killed in Afghanistan on Sunday, Lieutenant John Thornton and Marine David Marsh. We owe them both a deep debt of gratitude. As the House will be aware, my right hon. Friend the Prime Minister is today in Bucharest, Romania, for the NATO Heads of State and Government summit meeting.

Eric Joyce: In a few days, the all-party group on the great lakes region of Africa will visit Rwanda and the Democratic Republic of the Congo, both of which have proper, legitimate, democratically elected Governments. Does my right hon. and learned Friend agree that it is, today, time for Mr. Robert Mugabe to accept that the people of Zimbabwe deserve no less?

Harriet Harman: I commend my hon. Friend for the work that he does in his all-party group. He is absolutely right: the whole House will want to express its solidarity with the people of Zimbabwe and its concern that they should have their democratic choice respected and recognised. Hon. Members in all parts of the House have raised the plight of the people in Zimbabwe. Four million people have been forced to flee that country. The average life expectancy is now down to 34 and the economy is in ruins, but today the eyes of the world are on Zimbabwe, which stands at a turning point. Robert Mugabe must respect the decision of his people.

William Hague: I join the Leader of the House in paying tribute to Lieutenant John Thornton and Marine David Marsh, who were killed in Afghanistan on Sunday, and to the soldier who was killed in Iraq last Wednesdaya further reminder of the sacrifices and service of our armed forces.
	On a lighter note, I should like to congratulate the Leader of the House on being the first female Labour Member ever to answer Prime Minister's questions. She must be proud, three decades on, to be following in the footsteps of Margaret Thatcher, whom we on the Conservative Benches, and the Prime Minister, so much admire. I have just one question on Zimbabwe before the Foreign Secretary's statement at 12.30 pm. Will the Leader of the House make it clear, on behalf of the Prime Minister, that Britain wants to send the clearest possible signal that the world will be there to help the people of Zimbabwe, on top of what she has just rightly said, and that there will be a comprehensive plan to assist them, whenever they are able, to move away from corruption and dictatorship, to the rule of law and democracy?

Harriet Harman: I thank the right hon. Gentleman for his congratulations, but I would like to ask him: why is he asking the questions today? He is not the shadow Leader of the House; the shadow Leader of the House is sitting next to him. Is this the situation in the modern Conservative partythat women should be seen but not heard? If I may, perhaps I could offer the shadow Leader of the House a bit of sisterly advice: she should not let him get away with it.

Hon. Members: More!

Harriet Harman: On the question of Zimbabwe, I absolutely endorse the right hon. Gentleman's comments, and I do so on behalf of the Government. This Government are the second biggest donor to Zimbabwe and we stand ready to step up that support. We will work with the international community, but it is also right to focus on South Africa and Africa to help find a solution to the problem. My right hon. Friend the Prime Minister has spoken to Thabo Mbeki and to Kofi Annan; he will work to make sure that pressure is put on Robert Mugabe to respect the democratic choice of his people.

William Hague: Before turning to domestic issues, I was going to be nice to the right hon. and learned Lady. She has had a difficult week. She had to explain yesterday that she dresses in accordance with wherever she is going: she wears a helmet on a building site, she wears Indian clothes in the parts of her constituency with a large representation of Indian people, so when she goes to a Cabinet meeting, she presumably dresses as a clown.  [ Interruption. ] As I said, I was going to be nice to her before her previous response.
	Turning to serious domestic issues, the Prime Minister is reported to have said on Monday night that no one would be worse off as a result of the doubling of the 10p tax band this weekend. Does the right hon. and learned Lady think that that statement was true?

Harriet Harman: I would just start by saying that if I were looking for advice on what to wear or what not to wear, the very last person I would look to is the man in the baseball cap.
	Turning to the important question of the economy, it has been our Government's determination to ensure that we have a strong, stable and growing economy, so that people can be in work, be in their jobs and be better off. What is important is that people should have jobs and be able to afford their mortgages. Before the right hon. Gentleman cries any crocodile tears about low-income families, perhaps I can remind the House that when he was Leader of the Opposition, it was he who led the opposition to our national minimum wage and he who led the opposition to tax credits, which are helping 6 million low-income families.

William Hague: I did not detect an answer to the question in all of that. The Leader of the House might still need advice on what to wear, and if she thinks her constituents might kill her, she should look behind her.
	Is it not the case that, contrary to what the Prime Minister said on Monday night, 5.3 million mainly lower-paid families will be worse off this weekend, as demonstrated by the Institute for Fiscal Studies and as confirmed by a Treasury official to the Treasury Committee? Is she further aware that after the meeting of Labour MPs on Monday night, where that point was made, one Minister is reported to have said:
	Gordon did not seem to understand what they were talking about and kept insisting that nobody would lose out... He didn't seem to understand why voters were unhappy with it and gave the impression he was living on another planet.
	Was not that Minister speaking the truth; and was it by any chance her?

Harriet Harman: One thing we recognise is that the tax burden under this Government is not as high as it was under the Government of whom the right hon. Gentleman was a part. When it comes to standards of living, when we came into government, this country was the worst among the G7 for average income per head, and after 10 years of Labour government, we are second from the top; and we stand by that record.

William Hague: If the right hon. and learned Lady thinks the tax burden is declining in this country, the Government are even more out of touch than anyone might have thought. The cost of living is rising; real earnings have fallen for two years; and the Government have chosen this moment to hit 5 million mainly lower-paid families and kick them when they are down. Let me read what another Minister saidthis time on the record. The Health Minister, the hon. Member for Bury, South (Mr. Lewis) said that people
	feel the Government is losing touch with what fairness means to the majority who work hard, play by the rules and are feeling squeezed by rising utility bills, the cost of petrol and rising council tax.
	Does she not have even a little bit of sympathy with that Minister's view that people feel that the Government are out of touch?

Harriet Harman: I do think it is right to recognise that with the international financial turbulence and uncertainty, people are apprehensive. They need to be able to look to the Government to have the determination that we will make sure that our economy is as resilient as possible as this country faces difficult and challenging economic circumstances. It is because we are in touch and concerned about the issues that most affect the British people that we have improved hospitals and schools and have ensured that there are more jobs in the economy, and that is what we will continue to do.

William Hague: The right hon. and learned Lady is allowed, while the Prime Minister is not here, to say that the Government are out of touch. He has gone to a meeting in a palace, so he is probably lost by now. She is allowed to agree with the Minister who said that the Government are out of touch.
	The right hon. and learned Lady has acknowledged, and I thank her for that, that people are apprehensive about the situation, but two months ago she wrote in her blog that
	there was no sense at all of concern or insecurity over the economy. People...are not worried about their own prospects for 2008.
	Does she want to update that statement in the light of what she just said and say that people are now apprehensive and are feeling insecure, and that the Government are out of touch?

Harriet Harman: When I wrote that blog as part of my Harriet in the High Street [Interruption.] When I wrote that blog, having talked to people in Princes street in Edinburgh, that is what people were saying to me. I acknowledge, and we readily acknowledge, that since then the situation internationally has become more turbulent and people's concerns are raised. We have to be ever vigilant and make sure that we keep the economy strong through difficult international times, in a way that the previous Conservative Government did not.
	As far as the right hon. Gentleman's jokes are concerned, normally people used to say about him, Great jokes, poor judgment, but I have to say that on today's performance, he should be worrying about his income as an after-dinner speaker.

William Hague: I will not ever accuse the right hon. and learned Lady of being all jokes. We need not worry about that. But has she not just given a demonstration of how out of touch the Government have become? Five million families are worse off this weekend and the Prime Minister denies it; council tax has doubled as of this weekend; and 300,000 small businesses are worse off this weekend. Is not the question that the whole country is asking, why do we have to wait another two years to get rid of this discredited Cabinet and have a change of Government?

Harriet Harman: The fact of the matter is that our economy is continuing to grow, and that is very important. We recognise that it will be growing at a slower rate than predicted, but it is important that it continues to grow. We recognise, too, that there will be continued investment from business and in industry. We recognise also that what is necessary to keep the economy growing is to ensure that the skills and education levels of people in this country continue to improve. That is why, to secure the economy for the future, we are ensuring that there is education up to the age of 18 for all people in this country; we are ensuring that there are more apprenticeships for people in this country; and we are also ensuring that more people have a university education. If the right hon. Gentleman was concerned for the prospects of our economy, he would be backing that, not opposing it.

Rosemary McKenna: The environmental lobby is urging us to save the planet by drinking only tap water. I have two water bottling plants in my constituency. May I ask my right hon. and learned Friend to agree that in any future discussions, we remember the jobs of those in the water bottling industry?

Harriet Harman: We must recognise the need both to ensure that there is high employment in the economy, including the economy in my hon. Friend's areaI know that she is a champion of people thereand to cut unnecessary waste. That is why the Government are introducing tap water instead of bottled, at least in the public services.

Vincent Cable: rose

Hon. Members: Hear, hear!

Mr. Speaker: Order.

Vincent Cable: May I begin by adding my condolences over the soldiers killed in Afghanistan and Iraq?
	It was reported earlier this week that Her Majesty the Queen had cancelled her diamond wedding celebrations because it was judged inappropriate to engage in extravagance at a time of economic gloom and recession. Does the Leader of the House share my view that that demonstrates Her Majesty's unerring instinct for the public mood, or do the Government think that she was overreacting?

Harriet Harman: rose

Mr. Speaker: Order. The hon. Gentleman should not discuss Her Majesty the Queen. Perhaps he could try asking another question. He has used one up, and he will not get another after that.

Vincent Cable: I am very happy for the Leader of the House to return to the issue of economic gloom and recession. Does she agree with that assessment?

Harriet Harman: As I told the right hon. Member for Richmond, Yorks (Mr. Hague), our concern is to ensure that people continue to have jobs. As the hon. Gentleman will know, the economy still has 670,000 vacancies, and we want to ensure that it continues to grow as it has for some 62 consecutive quarters.

Vincent Cable: rose

Mr. Speaker: Order. The hon. Gentleman is out of order. I must move on.

Jim Devine: As my right hon. and learned Friend is aware, today is world autism day. Autism affects tens of thousands of individuals and families throughout the United Kingdom. What message has my right hon. and learned Friend for those people on this special day?

Harriet Harman: I am glad that my hon. Friend has given me the opportunity to mark national autism day on behalf of the Prime Minister. Three things are important in relation to autism. The first is early identification: the earlier autistic disorder can be identified in a child, the more help and support the family and the child can receive. Secondly, the health services, which help families and children with autism, and the education services are vital. That is why we have doubled investment in services for children with special needs. Thirdly and above all, I pay tribute to those in the voluntary sector, particularly the National Autistic Society. They are a lifeline for parents, and without them many families simply could not cope.

Angus Robertson: The United Kingdom and Scottish Governments are both right to provide the appropriate number of prison places. Why is the Treasury not providing the 120 million of Barnett consequential funding that would help to reduce overcrowding in Scottish prisons?

Harriet Harman: We have built more prisons and more offenders are being brought to justice, which is the reason for the increase in prison numbers. As for the hon. Gentleman's point about prison places in Scotland, I will ask my right hon. Friend the Secretary of State for Scotland to write to him.

Derek Wyatt: Last Friday, after campaigning, I went to my local Bangladeshi curry house.  [Interruption.] I was told that members of the immigration service are now visiting Bangladeshi restaurants between 7 pm and 8 pm on Fridays and Saturdaysa critical period for any restaurant, because it is the busiest period of the week. They are closing the restaurants and clearing the customers out, who leave without paying for anything. The restaurant owners lose their revenue for Friday and Saturday nights, and are not allowed to telephone a solicitor or their Member of Parliament. That is not acceptable. Will my right hon. and learned Friend meet a group of Bangladeshi restaurant owners, so that we may at least change the process engaged in by the immigration service?

Harriet Harman: I know my hon. Friend will understand that the enforcement of immigration rules has to be an operational matter for the Border and Immigration Agency. However, the Bangladesh Caterers Association has already made representations to me on this issue, and I know that its members play an important role in this country and our economy, and I would be happy to meet representatives of the association with my hon. Friend.

Charles Walker: Will the right hon. and learned Lady join me in condemning Nick Eriksen, the British National party candidate for the London assembly elections who said:
	To suggest that rape...is a serious crime is like suggesting force-feeding a woman chocolate cake is a heinous offence?
	Will she not agree with me that this manthis creatureis not fit to run for public office?

Harriet Harman: I strongly support the hon. Gentleman's comments, and I thank him for bringing this matter before the House. It is for all parties in London to say that we have to make sure that everybody votes in the London election, because the best way to avoid a BNP member being elected to the London assembly is for as many people as possible to vote for all the other parties.

Louise Ellman: The Daresbury science and innovation campus is a great success for the north-west region, for the country and for world-class science. Does my right hon. and learned Friend agree that its future is too important to be left solely in the hands of the scientific research council involved?

Harriet Harman: My hon. Friend is a great champion of science, and of the Daresbury centre in her constituency, and I pay tribute to her for that. She will know that this Government have doubled investment in science, and that the Minister for Science and Innovation is in Daresbury in her constituency today announcing 25 million in extra funds for the next phase of the Daresbury science and innovation campus.

Edward Davey: Can the Leader of the House explain to council tenants in my constituency why the Labour Government ask them to subsidise council tenants in other parts of the country? Why is it that for every pound that a council tenant pays in rent to Kingston council, the Government take away 31p to give to other councils? The Prime Minister told the House in July last year that he would reform this unfair system; why has nothing been done?

Harriet Harman: We are reviewing the way in which the housing revenue fund works, but I hope that the hon. Gentleman will join me in welcoming the fact that in all the council estates and blocks in his constituency there have been new roofs, new windows and new lifts, and that there has been major investment in council housing since this Government came into power.

Mr. Speaker: I call Bob Wareing.  [Interruption.]

Robert Wareing: Thank you, anyway, Mr. Speaker.
	Will my right hon. and learned Friend ask the Prime Minister my question? Given the anxiety of people who live near the airports in London, particularly Heathrow, is it not time for there to be a fresh review of airports policy? We should consider the number of business men and tourists who have to travel from the north of England to London in order to fly abroad; that is ludicrous. Regional airport expansion should take place, and airports such as Liverpool, which could

Mr. Speaker: Order. I am so glad I called the hon. Gentleman, but he has gone on a wee bit too long, so I have to stop him.

Harriet Harman: I will pass my hon. Friend's question on to the Prime Minister, but I should also say to him and the House that my right hon. Friend the Secretary of State for Transport is keeping all those issues under close review.

John Baron: The Government talk much about Britishness, but it is certainly un-British to lock someone up for more than a month purely on grounds of suspicion, rather than evidence. Given that the pre-charge detention period in most other western democracies is less than a week, can the Leader of the House do something that her entire Home Office Front-Bench team has been unable to do so farexplain what is so unique about the British that we need more than a month?

Harriet Harman: I have to start by saying that I think the international comparisons have been spurious.  [Interruption.] They have. People have been comparing completely different processes. On the proposals that this Government are bringing to this House, on which each Member will shortly be able to vote, the Government's responsibility is to ensure that the public are safe, and safe from terrorism. It is also the responsibility of this Government to ensure that we protect civil liberties and human rights. I find it very ironic that the Conservative party, which purports to be strong on public protection, does not support the measures that we are putting forward and suddenly decides that it wants to be concerned about human rights when, in fact, it would abolish the Human Rights Act 1998, which this Labour Government introduced.

Mark Todd: One of the least heralded but most popular initiatives taken in schools in this country has been the fruit in schools scheme offered to infants. Some schools in my constituency voluntarily extend that scheme beyond the narrow age range that it covers. Does my right hon. and learned Friend agree that the Government should consider extending the range of offering made at the moment to make this popular scheme available to other children?

Harriet Harman: I thank my hon. Friend for raising that point, because he is right. We introduced the scheme in 2004, and all four to six-year-olds in primary school now have free fruit every day. He will remember, as other hon. Members doubtless will, that when we first introduced the proposal it was jeered at; the Conservatives called it the nanny state, but we called it improving children's health.

Anne Main: I welcome the fact that Lucentis will be prescribed for those suffering from wet macular degeneration, but I was disappointed that the Health Minister who responded to my debate on dry macular degeneration seemed to accept that the provision of services and appliances was poor, yet is not having much done about that. Given that the Leader of the House accepts the need for the right kit for the right association, can we have the right kit for dry macular degeneration sufferers?

Harriet Harman: Having set up the National Institute for Health and Clinical Excellence, we want to ensure that there is an evidence-based process for new drugs. I would say to the hon. Lady that whatever she would like to achieve in the health service, it cannot be achieved without the extra investment that Labour has made over the past 10 years and is determined to make in the future.

Sharon Hodgson: I myself and other hon. Friends have joined forces to campaign for free, universal, locally-sourced school lunchesFULL. I am pleased to say that the  Daily Mirror is backing our campaign, recognising that such a policy would help to fight child poverty and child obesity. Does my right hon. and learned Friend recognise that that radical and progressive policy would benefit the health and education of millions of children, regardless of family income?

Harriet Harman: I pay tribute to my hon. Friend, who is a champion for children in her constituency. I know that she has been pressing on this campaign. The Government have responded to the points that she has raised and are examining the results of the pilot that has taken place in Hull. We have increased both the take-up of free school meals and the eligibility for them. It is very important that all children have a good, nourishing, hot meal at least once a day.

Norman Lamb: Last week, people living in the broads area of Norfolk were confronted by a report by Natural England proposing the possible abandonment of six villages and 25 square miles of land to the sea. The Leader of the House will understand the potential implications of any report of that sort. The immediate implication is that it is proposed without any compensation to those affected. Can she offer any reassurance to those communities that the Government will defend this coastline?

Harriet Harman: I am aware of the issues raised by the hon. Gentleman. The question of sea defences in the part of the world that he represents is very important. My right hon. Friend the Secretary of State for Environment, Food and Rural Affairs is working with the Environment Agency and will work with local authorities and Members of Parliament in the area to ensure that we take the right way forward.

John Spellar: Will the Leader of the House join me in welcoming the extension of free bus passes across England yesterday and the extra Government funding to local councils to pay for that?

Harriet Harman: I certainly welcome the extension of free bus passes. Let me take the opportunity to say two things. First, people who are over 60 want to get out and about, to see their friends and family and to socialise. It is important that they should have the opportunity to do so on public transport.
	Secondly, in 2000 we required local authorities to introduce half-priced fares for pensioners and disabled people. In 2006, we required local authorities to provide free fares for all pensioners and disabled people. From today, wherever they are in the country, pensioners and disabled people will be able to travel free.

Peter Bottomley: When the Government changed the emphasis from the retail prices index to the consumer prices index, were they aware that their new choice of index would be substantially lower than the higher one? What does the Leader of the House have to say to the pensioners who suffer because of it?

Harriet Harman: I will ask the Chancellor to write to the hon. Gentleman on that point.

Zimbabwe

David Miliband: The whole world is watching events unfold in Zimbabwe, and with your permission, Mr. Speaker, I shall make a statement on the situation as we understand it. I hope and believe that the people of Zimbabwe will hear one message from this House today: we stand with them at this moment of opportunity for their country and we share their demand for a democratic future.
	For obvious reasons the fragility of the current situation means that I and, I am sure, all hon. Members will want to choose our words carefully, given the risk that what we say will be distorted. That does not mean that there are not some fundamental truths that need to be expressed.
	I have within the last 30 minutes spoken to our ambassador in Harare. The situation is obviously fluid and a Movement for Democratic Change press conference is in train as we speak. Zimbabwe's political, civic and economic leaders are clearly considering their next moves and each others' next moves. The full results of the parliamentary elections are still unclear. The latest tally, as of 10 minutes ago, is that 189 seats have been declared and 80 remain to be declared. The two main parties are running neck and neck, at least according to the official figures.
	There is still no formal announcement about the presidential election. Many hon. Members will have seen the comments made by Opposition Leader Tsvangirai last night. His comments and demeanour were statesmanlike. He committed himself to following Zimbabwean law, providing all the more reason for the results to be announced promptly.
	Although the situation in Harare is tense, there is no suggestion of crowds massing and no reports of violence. But it is not business as usual: many schools are still closed and people are watching and waiting to see what will happen. Let me assure the House that through both political and official channels there has been a high degree of contact and consultation between the UK Government and our international partners. The Prime Minister, Lord Malloch-Brown and I have been in touch with Presidents, Prime Ministers and Foreign Ministers in southern Africa and around the world. There is international consensus that the will of the Zimbabwean people must be properly revealed and respected.
	Last Saturday, the people of Zimbabwe made their choice. Outside the 9,400 polling stations, the tallies have been posted. The Zimbabwean electoral commission knows what those results are and has a duty to announce them. The delay in announcing the outcome can be seen only as a deliberate and calculated tactic. It gives substance to the suspicion that the authorities are reluctant to accept the will of the people. They have a responsibility to do so, and Zimbabwe's neighbours, who have borne a significant share of the burden of Zimbabwe's collapse, have a responsibility to do all in their power to ensure that that occurs.
	No one in the House would want me to hand ZANU-PF a propaganda coup by endorsing one candidate or another, or by taking it on myself to announce the result. In truth, in spite of what President Mugabe would want the world to believe, the crisis in Zimbabwe has never been about personalities. It is not a bilateral dispute between British and Zimbabwean politicians or anyone else. It is, and has always been, about the policies that Robert Mugabe and his Government have chosen to follow and the terrible destruction that has been wreaked on the Zimbabwean people. Now the choice is between democracy and continued chaos.
	The situation preceding these elections was shocking. The conditions for free and fair elections were certainly not in place. The playing field was tilted heavily in favour of ZANU-PF. Up to 4 million people who had fled Zimbabwe's crisis could not vote. In some areas, between 18 and 20 per cent. of those who tried to vote were frustrated by an inaccurate electoral roll. We will probably never know how many dead people on that roll cast ghost votes. In that context, it is worth saying that if a second round of voting is deemed necessary, it must be held in a way that gives far greater respect not just to our standards but to the Southern African Development Community electoral standards. We remain in contact with our SADC partners on the issue.
	We do know, however, that in spite of those problems, millions of ordinary Zimbabweans still queued peacefully and voted. Now they are holding their breath: will their country reverse the spiral of decline or exacerbate it? The facts speak for themselves: life expectancy has halved to an average of 34, nearly 2,500 AIDS-related deaths occur each week, inflation is practically incalculable and day-to-day abuse of human rights and freedoms is commonplace.
	Britain has always supported the Zimbabwean people through the pain of their national trauma, and must continue to do so. We are the second largest bilateral donor, and spent more than 40 million last year on aid. Our support provided HIV treatment for more than 30,000 HIV/AIDS patients and helped the World Food Programme to feed up to 3 million people, about one quarter of Zimbabwe's population.
	We want to do more to encourage development within Zimbabwe. When there is real and positive policy change on the ground, the House has my assurance that Britain will play a full part in supporting recovery. We know that the Zimbabwean people face a massive rebuilding task. We will help them to do that, with EU and international colleagues, but that can happen only when and if there is a return to real democracy and good governance in Zimbabwe.
	We will continue to do all that we can to encourage that to happen and to encourage other countries in the region to exert what influence they have over the situation in Zimbabwe. Those with the greatest influence are of course those closest to Zimbabwe, but we are clear that the situation will not be one that Africans alone have to carry the burden of supporting.
	The House will want to know that our ambassador and embassy staff are safe. Both UK-based and local staff are working tirelessly in very difficult circumstances. They are in very close contact with a wide range of Zimbabweans and stand ready to offer consular assistance to the many British nationals in Zimbabwe.
	Many hon. Members in all parts of the House have been tireless advocates for the true interests of Zimbabwe over many years. The people of Zimbabwe have suffered for too long. Every hon. Member and every British citizen will yearn with them for that suffering to end, and for it to end now.

William Hague: I thank the Foreign Secretary for coming to the House to make this statement. He said that he hoped and believed that the people of Zimbabwe would hear one message from this Housethat we stand with them at this moment of opportunity. I absolutely support him in saying that so that they do hear that one message from this House, and we strongly support the Government's calls for the immediate and full release of the results of the election.
	This is obviously a crucial but dangerous time for Zimbabwe. As we saw recently in Kenya, contested election results in highly charged circumstances can lead to a very dangerous situation. In Zimbabwe, the combination of brutality and repression for many years, a desperate humanitarian crisis and decades-long stifling of political opposition create the circumstances of a political pressure cooker.
	As the Foreign Secretary said, it is not about personalities. Mugabe is the author of Zimbabwe's catastrophe, but it will no doubt take much more than his departure for the country to recover. However, there is now hope for change: the Mugabe Government may attempt to cling to power, but they may just be unable to resist the force of an overwhelming public rejectionif that is what has happened in the election.
	I turn now to some specific questions. Is the Foreign Secretary aware of whether President Mugabe has spoken to any of the leaders of neighbouring countries? It does not seem so, but has he given those leaders any indication of his intentions?
	There have been reports of negotiations between the Zimbabwean Government and Opposition leaders. Has the Foreign Secretary been able to confirm any of those reports? He rightly referred to our very hard working embassy officials, but have they been able to speak to Morgan Tsvangirai or his senior colleagues? What assessment has he made of the threat to Opposition figures, many of whom are reportedly in hiding in anticipation of a crackdown?
	One of our immediate concerns, of course, is the safety of British citizens in Zimbabwe in the event of an outbreak of violence. The Foreign Secretary touched on that in his statement, but will he assure the House that our ambassador in Harare has well developed contingency plans if the situation suddenly deteriorates? Even before the crisis, it took Z$10 million to buy a loaf of bread, and 4 million people were dependent on food aid. Are the British Government liaising with the UN about preparations for emergency food and medical support, as well as for coping with a sudden outflow of refugees into neighbouring countries?
	The Foreign Secretary mentioned continuing British support for the people of Zimbabwe. Does he agree that we must prepare actively now for the rehabilitation of Zimbabwe at the appropriate timethat is, when it is set on a clear course towards the rule of law and democracy? Whenever that happens, does he accept that Britain, with the international community, must be preparing a major programme of assistance now?
	Does the Foreign Secretary agree that such a programme could include holding a donor conference, under the auspices of the European Union and the African Union, to develop a programme of assistance that is tailored to Zimbabwe's needs? The programme could include setting up a contact group to provide sustained diplomatic support, and an offer to assist Zimbabwe in the move from being a culture of violence to one governed by the rule of law. That could be achieved by supporting thorough reform of the security sector, training officials in civilian policing and human rights, and assisting with the orderly return of the Zimbabwean refugees to whom the right hon. Gentleman referred. Could not that programme of assistance, in the event of a major deterioration in the situation in Zimbabwe, also include making preparations for an international observer mission or over-the-horizon humanitarian force, under the auspices of the AU and backed by the major powers in the world?
	Does the Foreign Secretary agree that there might be something of a golden houra window of opportunitywhen the international community ought to be prepared to take rapid and decisive steps to help the people of Zimbabwe in rebuilding their country's economy and society? To succeed, that country will need support from its neighbours, international organisations and its friends. Will he do his utmost to ensure that all of those stand ready to help?

David Miliband: I am grateful to the right hon. Gentleman for his words today, not least because the speed of change in the situation in Zimbabwe has made it difficult to give him as much advance notice of the contents of my statement as would normally be the case. A number of his questions would be very interesting to discuss, although probably not in the full glare of publicity in the House of Commons, so I hope that he will accept the following answers.
	I think that the right thing to say about President Mugabe is that he has been conspicuous by his absence from the air and telephone waves. The right hon. Gentleman mentioned reports of negotiations, and we have seen them as well. In my statement, I said that senior figures in Zimbabwe were watching and waiting, and it is clear that discussions have been taking place both within and between parties.
	The right hon. Gentleman made an important point about the security situation and the security of Opposition figures; that is obviously a great source of concern. There is also the issue of the security of Zimbabweans of all backgrounds. He asked about consular planning. Of course we try to stay in close touch with as many as possible of the 10,000 or 12,000 British nationals in Zimbabwe. We have reached some far outlying areas, but of course we cannot be complacent, given some of the doomsday scenarios that have been mooted. I can assure him that there has been a serious degree of activity on our part, and on the part of the Department for International Development, to deal with that contingency.
	The other side of the coin is, of course, a brighter future for Zimbabwe. As I suggested in my statement, it is important that the whole international community is ready, when it has a decent partner Government in Harare, to take part in the sort of comprehensive economic, social, political and security engagements that will help to rehabilitateI think that was the right hon. Gentleman's wordthe country. The rehabilitation will be on a scale not seen by almost any country for a long time. I cannot remember the exact levels of inflation in the Weimar Republic, but he mentioned that a loaf of bread cost Z$10 million; I think that four weeks ago it was Z$1 million. That is a degree of chaos that is almost unknown. However, I can certainly assure him that discussions are taking place.
	It is incumbent on the Government to try to prepare for all eventualities. One can never have perfect foresight, but it is important to refer to the second round of elections that might be deemed necessary. If they are, we want them to take place on a fairer and freer basis. The humanitarian situation also needs to be prepared for as far as possible, and I am grateful for the fact that on that matter, at least, there is cross-party support.

Mike Gapes: When the change in Zimbabwe comes, there will be, as the Foreign Secretary says, 4 million people who are outside their country. Many of them are in South Africa, but there are quite a large number of Zimbabweans in this country. Will he have urgent discussions with his colleagues in other Departments, including the Department for International Development, and with the people responsible for the Border and Immigration Agency, about providing assistance and help, in a careful manner, to those Zimbabweansdoctors, nurses, teachers and otherswho wish to go back to Zimbabwe to help to rebuild their democratic country?

David Miliband: My hon. Friend raises an important point. We are not yet ready to cross that bridge, but hopefully the time will soon come when we are, and I assure him that we will seek to do so in an effective and efficient way.

Edward Davey: Although the House will clearly want to debate Zimbabwe, and although I understand why the Foreign Secretary felt that he needed to make this statement today, in doing so does he not run the risk of being deliberately misinterpreted? Will he share with the House the exact reasons why he decided to make the statement, and why he did not contact the Opposition parties to see whether we would agree on whether to delay the statement? Will he reassure the Opposition parties that when there is something solid to comment on he will update us, especially during the recess?
	The whole House will share the great hope and excitement, expressed by many voices coming out of Zimbabwe through blogs and other media, that we may be about to witness historic, positive change in that wonderful country, which was brought to its knees by misrule of the most odious kind. I therefore agree with the Foreign Secretary that the Zimbabwean electoral commission must publish all the election results without further delay. Is not the most striking and fantastic aspect of the Zimbabwean general election the strong showing of the opposition parties, despite the massive electoral fraud and despite the political corruption? May I therefore associate my right hon. and hon. Friends with the Foreign Secretary's expression of solidarity with the people of Zimbabwe? We have a shared belief that the true democratic will of the Zimbabwean people must be heard and acted on. As I have made clear, I understand that the Foreign Secretary wishes to tread carefully, but will he confirm that the targeted EU sanctions will be maintained and toughened if the current regime tries to hold on to power in the face of a confirmed democratic verdict?
	The Foreign Secretary has begun to outline some of the Government's thinking on the help that Britain and the international community are already organising for a fresh Government. Will he assure the House that such support for recovery and reconstruction will be rapid and generous? Does he recognise that there must be no delay in providing support? Proposals such as new World Bank support and donor conferences are of course sensible, but assuming that those proposals go ahead, will he ensure that matters are so organised that international pledges of help actually materialise once the summit headlines have gone, as the record in Iraq and Afghanistan is not encouraging?
	Finally, will the right hon. Gentleman ensure that the support that the international community supplies also flows into Zimbabwe's neighbours, as their populations and economies have sheltered the vast majority of the refugees and exiles escaping Mugabe's tyranny?

David Miliband: I hope I may suggest, in the nicest possible way, that the fact that the hon. Gentleman has been able to ask four or five perfectly sensible questions shows that perhaps it was not completely ridiculous to make a statement today. However, I do not want to fall out with him about that. I will check with my office, but I would not want it to stand on the record that there had been no contact with the Opposition parties over the last two days; it is important that there is contact.
	The hon. Gentleman made an important point: one reason for being here today is the fact that the recess beckons, and I shall ensure that we stay in touch, even if not in quite such proximity, over the next two weeks.
	The hon. Gentleman tempts me into a series of perfectly legitimate hypothetical situations, either where democratic will is frustrated and sanctions continue or where democratic will is respected and rehabilitation and reconstruction are necessary on a grand scale. It is important, particularly given what he said about the danger of misrepresentation, that we keep saying that the onus is on the Zimbabwean electoral commission to announce the results and that the international community shoulder its responsibilities as it does so, although we must be clear that we are prepared for a range of eventualities. I hope he understands that to go beyond that could be seen as not terribly helpful. The hon. Gentleman's point about the impact of Zimbabwe on its neighbours is important, however, and many people will scratch their heads at how countries surrounding Zimbabwe have had to cope with such an influx of Zimbabwean refugees and how they have tried to manage the politics, as well as the social and economic consequences, of that.
	I can assure the hon. Gentleman that the Secretary of State for International Development and I try to look at southern Africa regionally, as well as nationally and locally, in relation to how our aid and other programmes work. We will continue to do so.

Chris Mullin: First, may I endorse everything the Foreign Secretary has said and, secondly, put to him the following? One of the few things that Mr. Mugabe has been successful at is representing his difficulties as a bilateral dispute between him and the UK and a legacy of colonialism. He has succeeded in convincing many of his African colleagues of that. Therefore, those who consider themselves friends of Zimbabwe should, as my right hon. Friend said a moment ago, be cautious in what they say at this delicate time to ensure that our position is not misrepresented, as it will be if we put a foot wrong.

David Miliband: My hon. Friend speaks with the authority of a former Minister for Africa, and in short I agree with him. I know that he is a true friend of the Zimbabwean people, and in everything he has said and done he has shown that.

Nicholas Winterton: It certainly appears that the prayers of those of us in the House who have taken an interest in Zimbabwe over many years may finally have been answered and that, despite an election that was clearly anything but free and fair, a majority of the people of Zimbabwe have clearly indicated that they want change. I agree with everything the Foreign Secretary said, as I do with what my right hon. Friend the Member for Richmond, Yorks (Mr. Hague) said.
	Will the Foreign Secretary give the House further information about the immediate aid that we can give to the people, not a Government, of Zimbabwe to reduce starvation and to help in relation to health and with AIDS, as well as the problems associated with it? That would give them hope that what they have done so bravely will be rewarded by a country that was in part responsible for bringing Mr. Mugabe to power.

David Miliband: The hon. Gentleman speaks with real passion, born of long engagement with the struggles of the people of Zimbabwe, or long sympathy with their recent struggles. He will know that the aid programme is now almost 50 million. It is paid through the United Nations, whose role was highlighted earlier.
	The best thing might be to ask my right hon. Friend the Secretary of State for International Development to put a note in the Library before the rise of the House tomorrow afternoon. I hope that there will be a double purpose in that: first, to inform hon. Members, but also to help to make it clear to the British people what difference their tax money is making today to the people of Zimbabwe.

Peter Hain: Does the Foreign Secretary agree that one fact is crystal clearMugabe has lost? First, if he had won, he would triumphantly have proclaimed that fact, as he did on all previous occasions. Secondly, for the first time we have an aggregation by independent monitors of results posted up outside local polling stations, and they show that he has lost. That being the case, it is vital that the international community stand together with the UN, the European Union and the southern African countries to ensure that an orderly transition of power takes place, and that there is an end to the prevarication and, frankly, the complicity with Mugabe's murderous rule, which there has been from Beijing to southern Africa for far too long. Mugabe has shown consistently that he will not go unless he has no alternative but to go. Quiet diplomacy has never worked with him.

David Miliband: My right hon. Friend, I am sure, is right about the significance of international unity, and seeking that international unity across the EU and the southern African countries is important. I very much concur about the significance and stress that he placed on the role of the civil society organisation ZENSthe Zimbabwe Election Support Networkand the highly innovative mobile phone-based photography it has produced of results posted outside polling stations, under quite some threat to the individual security of its members. I choose my words carefully: like my right hon. Friend, I have seen the results that came out of the sample540 of 9,400that the civil society organisation chose.
	There will be time for a post mortem on how we got here, and no doubt there will be different views on which countries played what role. At the moment, however, I would prefer to stick with the importance that my right hon. Friend placed on unity and the role of civil society organisations.

Menzies Campbell: I commend the Foreign Secretary for his restraint. Does he accept that although we here may feel a sense of responsibility, the harsh truth is that our influence is necessarily limited by the fact that we are the former colonial power? Is it not therefore the case that these events are a test for Zimbabwe and its people, but that, in a political sense, they are a real test for the countries of southern Africain particular, South Africa? Will he assure us that he has taken every opportunity to communicate our views to the Government of that country and, in particular, to Mr. Mbeki?

David Miliband: The right hon. and learned Gentleman raises an important point. As I think the Leader of the House said at Prime Minister's questions today, our Prime Minister spoke to President Mbeki on Monday. I am sure that the right hon. and learned Gentleman would agree that that conversation is about not only communicating our views, which is the phrase he used, but trying to discuss with President Mbeki how both our countries can play an appropriate role in addressing this situation. I am sure the right hon. and learned Gentleman agrees with that.
	As I said in my statement, the people who have suffered most are those in Zimbabwe. Those who know best the need for change are in Zimbabwe, but of course the neighbours close to Zimbabwe are greatly affected by these events.
	In respect of our own role, it is important that we do not in any wayI know that the right hon. and learned Gentleman would not do thisfall into the trap that was highlighted by my hon. Friend the Member for Sunderland, South (Mr. Mullin). We should not say things that play in the wrong way.
	Equally, we should not be at all ashamed of the aid and other programmes that we have sent to Zimbabwe over the last 28 years, destined to help the people of that country. In fact, we should try to be proud and to stand up for the fundamental truths that we have tried to express in the actions that we have taken. That is a difficult balance to strike, and I know that that is what the right hon. and learned Gentleman was referring to. Certainly, it is the balance that we are trying to strike. We are concerned about the situation in Zimbabwe because of the wrongs that are being done to people who deserve better.

Kate Hoey: I welcome the statement. This is an opportunity for us to send a simple message of support to the people of Zimbabwe without getting into any of the details that might be awkward. I also welcome the fact that both the Foreign Secretary and the Prime Minister have spent a great deal of time over the past few days on the telephone doing the work necessary to keep the international community and the European Union together on the issue. Does he agreethis follows on a little from the previous questionthat the role of South Africa in the next couple of days will be crucial, and can he assure me and all those in this country who have supported South Africa and who have links with South Africa and President Mbeki that this is the opportunity for President Mbeki to show that he is a true world statesman?

David Miliband: My hon. Friend, like the hon. Member for Macclesfield (Sir Nicholas Winterton), has played a valiant role in highlighting the situation in Zimbabwe and campaigning for effective international action on the issue. The international unity to which she refers was brought home to me at the meeting that I held in Paris on Monday. When I suggested to my six EU colleagues that we should interrupt a meeting about the French European presidency to talk about the situation in Zimbabwe, they wanted that to be the first item on the agenda because they saw the importance of it. I took heart from that that the matter is not seen just as a bilateral issue. Of course my hon. Friend is right that South Africa has the opportunity to be a powerhouse, economically and politically, for the whole of southern Africa, and the partnership with South Africa is extremely important. It is important to register the fact that many South Africans would say that the elections would not have happened at all without their intervention. Hopefully, those elections will allow the democratic will of the Zimbabwean people to be expressed.

Michael Ancram: I welcome the Foreign Secretary's statement. Although we must indeed be cautious about what we say today, those many of us in the House who have campaigned over the years for the democratic rights of the Zimbabwean people must hope and pray that this is the end of the long dark night of Zimbabwe and the breaking of a new democratic dawn. The lesson of history is that democracy can very quickly be undermined by chaos, and that the only way that can be avoided, as we have learned painfully in another area, is by having a comprehensive plan for reconstruction and aid in place, to be put into action immediately. While we wait for the result, can the Foreign Secretary, along with his international colleagues, begin to put that plan together so that once democracy is restored in Zimbabwe, as I hope it will be, there is no delay before that plan goes into action?

David Miliband: The right hon. and learned Gentleman makes an important point. I think he agrees with me that it is possible to be diplomatic in what one says without obscuring the fundamental truths that need to be expressed. He has expressed them in his own way. I have expressed the same sentiment. The shadow Foreign Secretary, the right hon. Member for Richmond, Yorks (Mr. Hague), referred earlier to Kenya. We want to try to avoid a Kenya situation. We are in a pre-Kenya situation in one way, which could easily become a Kenya situation, with the violence to which the right hon. and learned Member for Devizes (Mr. Ancram) was referring. That is a huge challenge. Every time we describe the chaos that has taken place in Zimbabwe over the past few years, we dramatise the difficulties of precisely the sort of operation that he mentioned, but he can be assured that although we are trying to engage on the immediate issue, we have an eye on tomorrow as well as on today. We will do our best in that respect.

Derek Wyatt: I thank the Foreign Secretary for his sensitive approach to the matter. I agree with my right hon. Friend the Member for Neath (Mr. Hain) that had President Mugabe won, we would have known about it by now. My right hon. Friend the Foreign Secretary may not be able to answer this question exactly, but I hope he will understand what I am trying to say. Mugabe has had five days to move his money, resources, diamonds and the oil that he owns outside the country. Can my right hon. Friend reassure us that all the international banks will have a letter from us if not today, then tomorrow, asking them to search the electronic records to make sure that no money is moved in any of the hundreds of accounts that Mugabe owns, especially those in Cairo?

David Miliband: The important thing to say is that our focus is on the interests of the people of Zimbabwe. That is the foundation of what we are doing. It is better if I just say that.

Gregory Campbell: Can the Foreign Secretary outline further what the Government will do to help the development of proper democracy in Zimbabwe and a move away from the corruption that has been endemic in that nation? Will he indicate what steps we can take to try to ensure that the 4 million refugees who had to leave Zimbabwe are allowed to return to help democracy flourish in that benighted land?

David Miliband: The hon. Gentleman makes an important point. It is worth remarking just how deep the democratic spirit is in Zimbabwe. Despite everything that has been thrown at them, far from forgetting how to vote or dispensing with their democratic rights, millions of people were determined to vote.

Menzies Campbell: They were queuing.

David Miliband: The right hon. and learned Member for North-East Fife (Sir Menzies Campbell) is right. The Zimbabwean people's faith in the ballot box has, remarkably, been undimmed by the traumas and travails that they have been through. In some ways, the nurturing of the democratic spirit is far ahead of the nurturing of democratic institutions in that country. In respect of democratic institutions, I know that the hon. Member for East Londonderry (Mr. Campbell) is committed to the work of the Westminster Foundation and other party-to-party links, which are important in building a decent civil society. That will be very important in the difficult task of reconstruction.

Keith Vaz: I warmly welcome the statement made by the Foreign Secretary today and the fact that he and the Prime Minister have telephoned so many African leaders. May I press the point made by the Chairman of the Foreign Affairs Committee? Will the Foreign Secretary speak to the Home Secretary about the Zimbabwean citizens in this country, many of whom do not wish to go back until the situation is secure? Will he ensure that there is no change in Government policy and there will be no removals until the situation is secure?

David Miliband: I am happy to speak to my right hon. Friend the Home Secretary about the matter in due course. It has been a pervading aspect of all our discussions that no one should do anything precipitate. That is the approach that we will take.

Peter Bottomley: There will be a great welcome when Zimbabwe again becomes a full member of the Commonwealth. When the election results come, may I commend to the Foreign Secretary two quick words? The first is from Kenneth Kaunda, who said when he stopped being President of Zambia, You win some, you lose some, and secondly, the words of the Lord Privy Seal 26 years ago who, when criticised for the result of the elections after Lancaster house, said, With free and fair elections, you can't always predict the result.

David Miliband: Those are good points. An hon. Member referred earlier to the result that we had produced in the first elections of Zimbabwe. The result was produced by the Zimbabwean people, but the democratic spirit has lived on. Although I have been lucky enough in my political lifetime only to win some, I take the hon. Gentleman's point that one wins some and loses some. Hopefully, we will not be able to enjoy that experience in the near future.

Eric Illsley: During 2004 the House of Commons Foreign Affairs Committee was somewhat surprised, during a visit to South Africa, at the level of support for President Mugabe and the criticism of the United Kingdom for the comments that we were making at the time in criticising his regime. African leaders have acquiesced in Mugabe's tenure of office over the past few years. It is crucialI echo calls from other Members around the Housethat my right hon. Friend does all he can to engage those leaders and, if there is a result that represents the return of democracy to Zimbabwe, to ensure that it is implemented. That is the key. At present, democracy no longer exists in Zimbabwe.

David Miliband: My hon. Friend leads me towards an important point. The temptations of the megaphone are very large indeed, especially where terrible things are being done, but sometimes the megaphone is not the best tool of diplomacy. Equally, to be timid is not right. To be silent is therefore to become complicit. The challenge for us all is to find a way to be effective without resorting to the megaphone, which, in the end, becomes ineffective. We all need to recognise my hon. Friend's point about the striking support that continues or previously continued to exist for Robert Mugabe. As I said to my right hon. Friend the Member for Neath (Mr. Hain), there will come a time for analysis. One of the things that will come out of that is that the megaphone that plays well here does not necessarily play well in the place that really matters. The challenge for us all is to make sure that we find the right implement.

Paul Keetch: In his discussions, has the Foreign Secretary had time to speak to President Seretse Khama Ian Khama, who was sworn in as President of Botswana only yesterday? I know that the President is a close personal friend of the Secretary of State for International Development. Will the Foreign Secretary be specific about the Commonwealth? If and when Zimbabwe returns to the road of democracy, as the Foreign Secretary describes it, will it be welcomed back into the Commonwealth immediately? That is one organisation to which the front-line states do belong and it could really participate in the rebuilding of civil society in Zimbabwe.

David Miliband: The hon. Gentleman makes an important point. In answering the hon. Member for Worthing, West (Peter Bottomley), I did not give due attention to that issue. This is an opportunity for the Commonwealth to show its real worth in the modern age. I will certainly be in touch with the new Commonwealth secretary-general, who started yesterday, at the appropriate time.
	I believe in the Commonwealth. An organisation that covers a quarter of the world's populationnorth, east, south and west, and all races and religionshas the opportunity to show what it means for different countries to work together and make the phrase the international community mean something. This situation is a good example.
	I think that I am right in saying that it was Zimbabwe that pulled out of the Commonwealth, rather than the Commonwealth that kicked out Zimbabwe in the beginning. But I very much hope that, first, a new Government in Zimbabwe would want to rejoin the Commonwealth, and, secondly, that the Commonwealth would give the country a very warm embrace.

Sally Keeble: I welcome my right hon. Friend's statement. Although I recognise the need for caution, does he not agree that the international community has a key role to play in standing absolutely firm and sending a clear message to the authorities in Zimbabwe that we recognise that this is a defining moment in the country's history, and it is inconceivable that there cannot be change of some sort? There is also a role for us to step up to the plate with the funds and the support for development. I am sure that, with those, the many extremely able and talented Zimbabweans will more than succeed in rebuilding their country.

David Miliband: I agree with my hon. Friend, who knows a lot about these issues. She is absolutely right about the potential of the country. It is a tragedy for any country to do as badly as Zimbabwe; it is a double tragedy when it has the natural resources and people to make a great success of itself.

Geoffrey Clifton-Brown: Will the Foreign Secretary confirm that there is enormous good will between the ordinary people of the United Kingdom and the ordinary people of Zimbabwe, no matter how they voted? Will he also agree that the front-line Southern African Development Community states have an important role to play, in particular in reversing the brain drainto encourage ordinary hard-working people to go back to Zimbabwe and build the country back to its former success?

David Miliband: The hon. Gentleman makes good points. As I said, we do not want to do anything precipitate. However, the outflux of refugees to the neighbouring countries has certainly been a huge drain on Zimbabwe and a huge burden for South Africa and other neighbouring countries. It is important that Zimbabwe returns to the equilibrium that it deserves.

Ann Winterton: What direct contacts has the Foreign Secretary had with his opposite numbers in the front-line states at this critical time before the election results are formally announced, so that they may encourage recognition of the wish of the Zimbabwean people for the rule of law and democracy?

David Miliband: I am happy to give one of a number of examples. The first call that I had was with the Foreign Minister of Tanzania. Our conversation was precisely about the respective responsibilities of the states closest to Zimbabwe. The Minister's President was deeply engaged on the issue. I shared with the Minister our hopes for the resolution of the situation, and we had a strong measure of agreement about the respective responsibilities of the different countries concerned.

Geoffrey Cox: In the past few days, constituents of mine with strong connections to the rural areas of Zimbabwe have brought me accounts of orphanages and elderly people's homes in dire distress. In some cases, staff have already left and elderly people, often with serious geriatric conditions, are left wandering around to try to feed themselves. The children in the orphanages are left untended and, in many cases, unfed.
	May I echo the plea of my right hon. Friend the Member for Richmond, Yorks (Mr. Hague) to the Government? When the will of the people of Zimbabwe is known and, as we all hope, Mugabe is removed, a programme of emergency relief must be immediately available from this country and we must not forget the elderly people's homes and orphanages, particularly in the often forgotten rural areas.

David Miliband: My earlier comment to the shadow Foreign Secretary about the particular needs of Britishas it happensnationals in far-flung areas was a reference precisely to the issue of children and, especially, elderly people. I would prefer not to wait in respect of elderly or young people who are in the situation that the hon. and learned Gentleman describes; if he gets the details of those cases to my office, I will forward them to the embassy in Harare straight away. There is already a food aid programme with significant British taxpayers' money behind it. It is administered through the UN. We need to know who the people whom the hon. and learned Gentleman mentions are, and find out why they are not part of the humanitarian support network.

Gerald Howarth: Some of us warned many years ago that Mr. Mugabe was not a fit person to be entrusted with the governance of Zimbabwe. We have looked on with increasing dismay and horror as he has systematically gone about destroying his countryalmost with the connivance of the South African Government, as the right hon. Member for Neath (Mr. Hain) said.
	May I ask the Foreign Secretary a specific question about what he said about aid? Will he ensure that the British taxpayer, having already contributed a substantial amount of money to Zimbabwe, does not contribute more aid unless it is specifically linked to good governance in Zimbabwe in future?

David Miliband: The position that my right hon. Friend the International Development Secretary and I have taken consistently is that the amount of aid should be governed by the situation of the people of Zimbabwe and our ability to make a difference with that aid. As the hon. and learned Member for Torridge and West Devon (Mr. Cox) suggested in the previous question, we would not want to stand aside if pressing needs could be met through available aid.
	As I keep on referring to the UN, I should say that we are not paying money through the Zimbabwean Government. If the concern of the hon. Member for Aldershot (Mr. Howarth) is that our money is being used for illegal or corrupt purposes, I should tell him that significant measures are taken to avoid that.

Hugo Swire: Although nothing that we say or do today in the House should in any way endanger attempts to persuade Mugabe to retire peacefully, will the Foreign Secretary reassure the House that the Government will not condone any deal that would eventually put Mugabe beyond the reach of The Hague?

David Miliband: Our position on that issue is well known; we are very committed to the role of the authorities at The Hague. I do not want to get into the issue of individual negotiations and discussions, but I can certainly say that they are not something in which I am involved.

Richard Benyon: Those of us who have been involved in this issue for many years might wish in our hearts to see a Ceausescu moment, when the world sees fear in the eyes of a despot. However, like all of us in the House, I recognise that such emotions are self-indulgent. Does the Foreign Secretary agree that, looking forward, one of the most important things that we have to do is stop the Zimbabwe central bank printing money like confetti? To do that, we need to implement the International Monetary Fund plan on which Mugabe reneged some time ago. Does the Foreign Secretary agree that that will require huge will from the international community? It is something that we really can do to bring about a rapid turnaroundI hopein the Zimbabwean economy.

David Miliband: The situation has got significantly worse since that plan was rejected; I would want to be sure that the plan was appropriate to the circumstances. However, I know that my right hon. Friend the International Development Secretary, and the Chancellor when he goes to the IMF spring meetings, will ensure that the issue will be on the agenda so that there is a proper plan when the time comes.

Illegally Logged Timber (Prohibition of Sale and Distribution)

Barry Gardiner: I beg to move,
	That leave be given to bring in a Bill to make it an offence for any importer or distributor to sell or distribute in the United Kingdom any wood harvested, manufactured or otherwise dealt with illegally in the country from which the wood originated or through which it passed or was transhipped; and for connected purposes.
	In this House, we are charged with the responsibility of making law. Our constituents, who bestow that privilege upon MPs, expect us to use it wiselythat is, to solve genuine problems without imposing yet greater ones upon them. Good law should carry the consent of the public who are governed by it. To do so, it must be possible to explain clearly the need that the legislation seeks to address and how it meets that need efficiently and simply, with the minimum of bureaucracy. The Bill that I bring before the House meets those tests. I believe that the significant cross-party support and the public backing of more than 30 non-governmental organisations and industry bodies as diverse as the Environmental Investigation Agency, James Latham Ltd, the Royal Society for the Protection of Birds, Global Witness and the Born Free Foundation demonstrate that this Bill is urgently needed and widely welcomed.
	Last year, the Stern report commissioned by my right hon. Friend the Prime Minister pointed out that between 18 and 24 per cent. of all the greenhouse gas emissions that are contributing to climate change come from deforestation. If we put all the power stations in the world togethercoal-fired, nuclear and all the other technologies for producing electricityonly then would we have a sector that contributed more to global warming than the loss of trees.
	Last December, in Bali, the United Nations forum on combating climate change led to an historic agreement among the nations of our world that deforestation was a major problem and that the means for avoiding it must form part of the post-Kyoto settlement. To do so requires that we create ways of rewarding sustainable forest management by the time of the Copenhagen conference of the parties in 2009.
	On the issue of forests, the world has declared that it shall run before it has even begun to walk. We cannot jump to sustainable forestry until we have established legal forestry. The World Bank estimates that trade in illegal timber amounts to US$15 billion every year. The UK is the fourth largest consumer market of imported tropical timber, yet only a fraction of it can be said with any degree of certainty to have been legally sourced and harvested in its country of origin. Illegal logging is a criminal activity. It corrupts and undermines governance in many countries across the globe. In doing so, it not only destroys forest ecosystems and contributes to carbon emissions but directly harms some of the poorest people on our planetthe indigenous forest-dwelling communities whose very livelihoods depend upon the forest. The $15 billion of this illegal trade is $15 billion that should be going into health care and education for them and their children.
	We declare our support for the millennium development goals, yet it is not an offence in the UK to trade for commercial gain timber that we know to have been harvested illegally in its country of origin. If we were dealing with private property such as stolen antiques or works of art, there would be no question but that those importing or selling those artefacts were regarded as criminals and dealt with according to the full force of the law. Yet in the UK, companies habitually trading in stolen timber have committed no crime and broken no law. My Bill would change that. Any distributor or importer who sold any wood that had been harvested, sold, taken or possessed illegally in the country from which the wood was originally harvested would be subject to various penalties, ranging from five years' imprisonment and a 100,000 fine down to a simple 5,000 fine, depending upon the degree of knowledge and degree of recklessness or good faith involved.
	I am grateful to the timber industry for its constructive engagement with my Bill, particularly given the severity of some of the penalties that it would impose. While recognising the pioneering work of companies such as Timbmet and others, I also want to acknowledge the help of the Timber Trade Federation, which has ensured that the Bill is much improved from its original draft. It now reflects the need to distinguish between three different cases: those who know full well that they are trading in illegal timber; those who should know but turn a blind eye and do not ask too many questions of their supplier if the price is right; and those who have acted at all times in good faith but are caught out by an honest mistake. Equally important, the best companies, which have diligently borne the expense of getting things right and have gone down the route of certification to ensure that they supply only legal and sustainable timber, would no longer see their products undercut by less scrupulous competitors.
	My Bill would achieve that not by imposing a ban on illegal timber at the borderthat would demand an army of Customs agents well versed in the changing legislation of each producer country and able to check the various certificates and licences that might be deemed proof of legalitybut by shifting the balance of risk by providing a clear incentive for companies to drive the burden of due diligence back down their own supply chain. Seals and ribbons that are the trappings of legality can be bought for $5 in the ports of far too many producer countries around the globefar better, then, that importers and distributors are put on notice that at any point they can be opened up to challenge and if found guilty will face substantial penalties. Not only Government agencies but NGOs and even the industry itself could bring forward evidence on which a prosecution could be based. The elegance of the Bill is that it does not seek to make a virtue out of catching those who do wrong but to alter the wrongdoers' behaviour by shifting the balance of risk against them. Ultimately, it is a Bill about protecting the environment, not catching thieves. To that end, it would apply Occam's razor by simplifying and cutting bureaucracy.
	The Bill should be seen in an international contextnot solely as it relates to trade between countries but in the context of other legislative measures. I particularly wish to recognise the international negotiations between the European Union and countries such as Ghana, Malaysia and Indonesia in negotiating forest law enforcement, governance and trade voluntary partnership agreementsFLEGT VPAs. That would introduce a voluntary licensing scheme that would allow only legal timber from VPA countries to enter European markets. My Bill would complement FLEGT by catching unlicensed timber from VPA countries that was laundered through third-party countries. It is no accident that the European Commission is considering measures similar to my Bill under the additional options paper. However, they would not be passed by the European Parliament until 2010, and we should not wait that long.
	I must also point to the leadership given in the United States by Congressman Earl Blumenauer and Senator Ron Wyden, who have introduced similar legislation to that which I propose as an amendment to the Lacey Act. Their initiatives and foresight have inspired the content of my Bill. I acknowledge with gratitude the helpful discussions that I have had with them and their officials. If there is a race between us as to who can get such measures on to the statute book first, it is the only race I know where each runner is urging his competitor to go even faster than he himself is able. The signal that would be given to world markets by both our countries enacting such legislation is incalculable.
	Perhaps the single most important legislative initiative in relation to illegal logging is that of Japan. This year, Japan hosts the G8 summit as its president. For the past three years, Japan has developed various initiatives against illegal timber, including its highly regarded Gojo wood policy. I have been privileged to chair, with my good friend Mr. Yoshino, the illegal logging dialogue. The purpose of that dialogue has been to make recommendations to the G8 summit in Hokkaido that will combat illegal logging. My Bill would be one that the legislators in the United States already

Mr. Deputy Speaker: Order. I fear that the rest will have to be taken as read.
	 Question put and agreed to.
	Bill ordered to be brought in by Barry Gardiner, Margaret Beckett, Mr. Elliot Morley, Eric Joyce, Mr. Andrew Dismore, Chris Huhne, Alun Michael, Joan Walley, Mr. Graham Stuart, Mr. James Paice, Mr. Ian Cawsey and John Mann.

Illegally Logged Timber (Prohibition of Sale and Distribution)

Barry Gardiner accordingly presented a Bill to make it an offence for any importer or distributor to sell or distribute in the United Kingdom any wood harvested, manufactured or otherwise dealt with illegally in the country from which the wood originated or through which it passed or was transhipped; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 17 October, and to be printed [Bill 94].

Opposition Day
	  
	[9th Allotted Day]

Repossessions and the Housing Market

Vincent Cable: I beg to move,
	That this House notes with concern the risk of recession in the United Kingdom economy; recognises that although the collapse of the United States mortgage market and the global 'credit crunch' are a catalyst to the current downturn in the United Kingdom economy, record levels of personal debt and the extreme bubble in the housing market were already major destabilising factors; further notes that because of inflation and weak public finances there is little scope for stimulating demand; applauds the efforts of central banks to reintroduce stability into the world money markets, but warns against the use of taxpayers' money in bailouts which cause serious concerns about moral hazard; further notes with dismay rising levels of personal debt, exacerbated by high mortgage interest rates; further notes the rising evidence of a major slowdown in the United Kingdom housing market; registers with concern the increasing number of people requesting help regarding mortgage payments; further notes with concern that repossession orders are now at the same level as in 1990; regrets the Government's failure both to admit the current problems in the housing market and to act to prevent mass home repossessions; calls upon the Government to consider options being used in the United States, particularly to encourage banks to explore options other than repossession; and further calls upon the Bank of England to include house prices in the measure of inflation.
	I am grateful for the opportunity to introduce this debate on a motion in my name and those of my colleagues. Perhaps I will be able to pursue answers to questions that I was not able to ask earlier in our proceedings. The Government's reputation rests very heavily on their economic credibility and performance, and they have won two elections on that basis. Two propositions are at the heart of their credibility: the first is that they have enjoyed the longest period of economic growth since records began in 1701I think that that is how the case is putand the second is the mantra that there is now an end to boom and bust. The first of those two propositions is still true, but looking rather precarious, and the second is beginning to look rather ridiculous.
	This is an Opposition day debate, and I know that the convention is to deal with such matters in a rather Punch and Judy way, but I shall try to avoid doing so for several reasons. First, we are at the beginning rather than the end of a difficult period for the economy, and it may be that with good policies and good luck, we shall avoid the worst, such as something similar to what happened under the Tories 15 years ago. Secondly, some of the problems are home-grown and result from failures of Government policy, but some are importedparticularly the credit crunchand the Government are not responsible for those. We need to acknowledge that there is a mixture of the two.
	The other point, which is technical but rather important, is that some of the problems we are now confronting are difficult and perhaps unprecedented. How does one deal with a big debt deflation problem, as it is called? How do we deal with the collapse of a bubble in an asset market such as housing? How do we deal with a drying up of credit in the banking system? Those are relatively new problems to which there are no obvious easy answers. I want to set some ideas for discussion as to how we might approach those questions.
	However, I do not want to be too generous. There are clearly criticisms that one can make of Government performance, and the central one is complacency. Many of the problems that we face were anticipated in the past. I recall raising the issue of the housing market and debt with the current Prime Minister in 2003. At that time, I put this to him:
	On the housing market, is not the brutal truth that...the growth of the British economy is sustained by consumer spending pinned against record levels of personal debt, which is secured, if at all, against house prices that the Bank of England describes as well above equilibrium level?[ Official Report, 13 November 2003; Vol. 413, c. 398.]
	The then Chancellor's reply was that I was scaremongering, but the scariest thing about my scaremongering is that my predictions turned out to be largely correct. There are major concerns in that area.
	Let me just review the problems. First, we have an acknowledged slowdown in the economy. We are not in a recession, but the slowdown is acknowledged. The Government's forecasts are significantly more optimistic than the consensus among independent forecasters, who, a few weeks ago, were predicting 1.7 per cent. growth for the next year. Those estimates have been marked down week by week. We have other estimates from companies such as JP Morgan, the bank advised by former Prime Minister Tony Blair, that there is a one third risk of recession. Lehman Brothers have now joined it in making such an assessment.
	In addition, we have severe, outstanding problems, many of which relate to problems of personal debt in a range of householdsnot all of them, but a substantial number. The total amount of personal debt in relation to people's income is now roughly 160 per cent.twice what it was when the Government came to office. It is the highest figure in our recorded history, and the highest in the developed world. Now, that is just a figure, and it does not necessarily relate to people's everyday lives. What does relate to their lives, however, is the amount of income that they have to spend in service of debt. That now stands at about 20 per cent. and comprises mortgage payments, interests on mortgages, unsecured loans and credit card payments. We are now at roughly the level of debt service required as during the great Tory recession of the early 1990s.

Philip Davies: I am sure that most people will share the hon. Gentleman's analysis of the problems. However, the Liberal Democrats are usually very good at telling everybody what the problems are, but very weak on the solutions. Does he agree that at a time when people are struggling to pay their mortgages, energy bills and petrol prices, and when their pay is going up slowly, if at all, one of the best things that the Government could do is reduce the burden of taxation on those hard-working families? It is quite the wrong time for the Government to scrap the 10p basic rate of tax.

Vincent Cable: We do agree with that, and we argued that case at the time. The hon. Gentleman was probably rehearsing his intervention while I was speaking, because I did say that half of what I wanted to say concerned constructive solutions. However, I agree with his specific point, which we have made many times.
	In addition to the problems of debt and the problems of debt service, there is a problem at the heart of the economic difficulties, which is inflation in the housing market, its consequences and the turnaround that may come from it. Since this Government came to office, the relationship between price and earnings has roughly doubled for housing. That has meant that a lot of people are a great deal wealthier and they have been happy to spend that wealth, which raises the question of what happens as the market goes into reverse.
	At the core of the Government's case, which is summarised in their amendment, is a statement made by the Chancellor a few weeks ago:
	Housing market conditions today are very different to those we saw in the early 1990s. Interest rates remain at comparatively low levelsas do mortgage rates. And unemployment is currently at 30-year lows.
	That is true, as far as it goes, but it is deeply misleading and extremely complacent, for several reasons. First, if we look back at what I call the great Tory recession[Hon. Members: Which one?] There were several, but I am talking about the last one, at the beginning of the 1990s

Philip Davies: Was that the one when we were in the ERM?

Vincent Cable: We were dealing with extreme conditions at the end of the Lawson boom [ Interruption. ]

Mr. Deputy Speaker: Order. I do not like to interrupt the hon. GentlemanI am sure that he is capable of taking care of himselfbut we really do not want sedentary exchanges across the Chamber. They spoil the debate.

Vincent Cable: Thank you, Mr. Deputy Speaker.
	At the end of the Lawson boom, interest rates stood at 15 per cent. and inflation at 10 per cent. Those are extreme figures, but the practical reality was that the cost of borrowing was 15 minus 10the real cost of borrowing was 5 per cent. real interest. Of course, we have different conditions today, as the Chancellor said. Someone borrowing at current rates will probably be paying 7.5 per cent. interest, but official inflation is about 2.5 per cent. The cost of borrowing in real terms is the same.
	There is another problem that is a simple point of arithmetic and logic, but I sense that the Chancellor and some of his Ministers do not fully appreciate it. Since the last experience, prices and mortgages have increased enormously in absolute terms. The absolute value of a mortgage has grown from 40,000 in 1999 to about 160,000. In relation to earnings, the level has doubled. In practical terms, that means that somebody trying to buy a house has to pay roughly twice the amount in mortgage servicing as they would have done in 1990. Interest rates may have halved, but the total mortgage outlays are the same because the mortgage is so much bigger. That accounts for the fact that so many households are under enormous stress.
	The Chancellor would arguehe is right up to a pointthat these days we have a sensible way of managing interest rates with the Bank of England, and the Bank of England can cut interest rates. The context is rather different, however. The interest rates set by the Bank of England rose from 5.5 per cent. in March 2003 to 7.5 per cent. in July 2007an increase of 2 per cent. Since then, it has been trying to cut rates, but the experience of households is not that of rate reductions. The alarming fact is that many households face increased interest rates because the banks are not passing on the cuts. They are not doing that because there is a credit crunch and credit has become unaffordable. Even those who have to refinance mortgages and can get them, which is unusual, pay increased rather than reduced rates.

Julia Goldsworthy: Does my hon. Friend share my concern that 60,000 families now take home less than 1,000 a month and spend 75 per cent. of that take-home pay on mortgage repayments? Those people will feel the pressure, and nothing is being done to tackle the problem. The figure for those affected is more than double the total number of repossessions last year.

Vincent Cable: My hon. Friend is right. She describes an extreme situation, but many others approach that position. If interest rates remain high because of the crisis in the banking system, many people will find current circumstances unsustainable.
	The key point in the Chancellor's comment that I cited, about which he was right, is that unemployment is much lower. That specific problem does not therefore exist. However, I noted from the Red Book a table that describes the assumptions that the National Audit Office audited. The Government are assumingI do not know whether the Financial Secretary is aware of itan increase in unemployment this year of approximately a couple of hundred thousand to a million. That may be a small change, but the Government acknowledge in their forecast that unemployment will increase, albeit at a low level. People find their mortgages unaffordable for many other reasons, such as short-time working and lack of bonuses.
	The new dimension, which changes the picture, is the fall in the price of homes that is beginning to occur. The obvious reaction is to believe that that is a good thing. If homes are unaffordable, it is surely desirable that their prices decrease to a more sensible level. That is correct, up to a point, but it depends on the extent to which and the speed at which it happens.
	According to the Nationwide's estimate, we have had five months of continually falling average prices. We have a forward market for property, which suggests that prices will fall by 10 per cent. this year and that, in five years, they will not increase at allin other words, they will fall substantially in real terms. Some forecasters are talking about falls of 25 to 30 per cent. in a couple of years. Although the Government sensibly do not venture into forecasting houses prices, they assume that the market is heading for genuine difficulties. We know that because of the Red Book's pessimistic forecasts for stamp duty receipts, which are due to fall by 800 million. They therefore assume a big fall in transactions.
	The Council of Mortgage Lenders confirms that 3 million families currently have properties with a loan-to-value ratio of more than 90 per cent. If the numbers that I have cited, such as the 10 per cent. fall in a year, materialised, all those families would be in negative equity in a year. That is happening to many people now.

Greg Knight: Is there not another new dimension that needs to be taken into account? Does not the hon. Gentleman accept that, back in the Lawson years, most borrowers would lend only up to two and a half times a family's annual income, whereas nowadays, some borrowers lend up to five times the annual income?

Vincent Cable: The right hon. Gentleman is a right. A great deal of reckless lending is involved. The Financial Services Authoritythe regulatormade that specific point a few weeks ago, when it estimated that 1 million families are at serious risk because of income multiples of around 3.5, as well as high loan-to-value ratios. There is a specific category of 1.4 million families who have taken the two-year, fixed-rate mortgagesteaser mortgages, as they are calledand now have to renegotiate them. Many find that they cannot raise the capital, that high deposits are being demanded of them or that even if they can raise the money, their interest rates are increasing from 4 per cent. to 7.5 per cent. That is only on the mortgage. Many were given unsecured loans, which are increasing to 15 per cent., as a part of the package. The position is therefore unsustainable for many of those 1.4 million families.
	We are beginning to see evidence of that in the repossession process. The Government amendment correctly points out that repossessions are much fewer than in the previous major financial crisis that we experienced. There were five years in the early 1990s when 300,000 people lost their homes, and the rate last year was about 27,000. The prediction of the Council of Mortgage Lenders for this year is 45,000. That is somewhat reassuring, but I do not know whether Ministers have spotted that the first stage of the repossession processthe so-called orders, which go to courtnow operates at a comparable level to that of the last slump. There are various reasons for that. Banks are no longer friendly, local high street banks. The securitisation of much mortgage debt means that many repossession orders are triggered by computer and no personal relationship is involved. As soon as somebody gets into difficulties, the order goes to court and that person is in the first stage of the repossession process. The problems may well be a great deal worse than in the last housing slump because of such changes.

Philip Davies: The biggest employer in my constituency is probably the Bradford and Bingley bank. My experience shows that it does all it can to help people stay in their homes and that repossessing people's property is a last resort. I hope that the hon. Gentleman will not try to go for an easy hit by attacking banks when many do an awful lot to try to help people stay in their homes.

Vincent Cable: The hon. Gentleman has a romantic view of contemporary banking, which is not reflected in the reality that most people experience. Perhaps he should have been here late on Monday when we discussed Northern Rock, which is one of the most aggressive banks.

Robert Smith: Is not there a growing concern that it is not necessarily the mortgage but the credit card and other debts, about which there is even less tradition of concern for the individual, that trigger repossessions?

Vincent Cable: My hon. Friend is right. An especially nasty trick is being played at the moment whereby many banks offer Together mortgages that are 125 per cent. of the value of the house. The extra is used to buy cars and go on foreign holidays. Anyone who defaults on the extra bit, above the mortgage, can be taken straight to repossession. That is happening.
	The current crisis could be much more difficult than the previous one because there are no safety nets. The right hon. Member for Hitchin and Harpenden (Mr. Lilley) made an important policy decision when he was in government. I am not making a personal comment, but referring to his ministerial record. He abolished the system whereby people could go to social security for help with mortgage payments. It now takes nine months before that position is reached. In reaching that decision, the right hon. Gentleman made the calculation, which was probably realistic at the time, that half of all borrowers would take out insurance in future. In practice, that has not happened. Only one fifth of households have taken out insurance. We are now in a different environment from the early 1990s, and there is no safety net. There is no social security assistance and there is no insurance. A comparable degree of pressure on payments therefore results in a much greater likelihood of people being taken to court and losing their homes.

Alistair Burt: As a former Minister in the same Department as my right hon. Friend the Member for Hitchin and Harpenden (Mr. Lilley), let me tell the hon. Gentleman that the calculation was also made that, in the first instance, building societies would renegotiate and spread their payments for six months, thus relieving a pressure on the taxpayer, but not putting individual householders in a more difficult position, and that was indeed what happened.

Vincent Cable: That might have happened at the time, but it is not happening now, and I will come to how we might address that failing.

Andrew Stunell: Does my hon. Friend agree that his figure of one fifth for insured households might be too optimistic or an overestimate of the cover available? Many of my constituents have found that those insurance policies do not work at the exact moment they need them to work.

Vincent Cable: That figure probably is an overestimate, which also reflects the fact that many policies are extraordinarily expensive. Those who now recommend insurance as a way of dealing with the problem fail to take into account the large cost associated with payments protection insurance, so my hon. Friend is right.
	The concluding part of my remarks is about what can be done. Again, I want to be constructive and raise questions about ways forward, rather than just criticise how things are being managed now. First, what can be done within the conventional policy framework? Normally when there is an impending recession, the standard answer, which we learnt or taught from economics textbooks, is to cut interest rates and run a budget deficitthey are the standard apparatus of macro-economic policyand that is indeed happening aggressively in the United States, but not here. We know that that is happening in the United States, because the chairman of the Federal Reserve, Mr. Bernanke, did his PhD thesis on the great depression from 1929 onwards. He is terrified, and says so publicly, that we are in danger of repeating that experience. He is desperate to head it off and is doing whatever he can.
	Our problem is that the Government are enormously constrained in what they can do that is similar. They made a good decision 10 years ago to make the Bank of England independent. The Bank now sets interest rates, which are not politically driven, and is making it absolutely clear that its first responsibility is to follow its mandate, which takes account of inflation, which is currently above the level that it should be pursuing. Therefore, the Bank's scope for cutting interest rates aggressively is limited. In addition, the Government claim that they have stayed within their rules for fiscal policy, but we do not know that, because there is no independent monitoring. In fact, the Government are up against the very limit of their fiscal rules and have absolutely no scope for the kind of expansionary policy that one would hope for in a period of recession.
	Even if it were possible to do those thingsto cut interest rates aggressively and run a fiscal deficitthere is little evidence to suggest that they would solve the problems that we now face, because interest rate cuts are not being passed on by the banking system, for the reasons that I have described. The conventional policy framework is therefore not adequate. The question is whether we could reform it.
	My colleagues and I have argued for several years that the Bank of England should have within its mandate a responsibility to take account of the housing market, not just conventional inflation. If the Bank had done that, it would have raised interest rates sooner, in the boom, and would be able to cut them more aggressively in a slump, now. That is one concrete suggestion that should be considered.
	The second policy question is whether the Government should simply be watching the drama of repossession unfold or whether they should intervene to do something about it. The Government's position is currently entirely passive. They take the view that there is no great problem, and that in any event it is nothing to do with them. However, we should perhaps at least consider what the options are.
	The first option, which the Council of Mortgage Lenders and several non-governmental organisations, such as Shelter and the citizens advice bureaux, are pursuing, is for the Government to revive the pre-1994 idea of giving greater social security help to people in mortgage difficulties. It has been suggested that it would help, for example, if the Department for Work and Pensions could secure a second charge on a home as a way of giving extra help. That is not the best way forward, because we would effectively be transferring all the risk from the mortgage lenders who made loans in the first place to the taxpayer. However, if the crisis develops momentum, that kind of idea might have to be considered.
	What else could be done? One possibility, which we are keen to promote, is for the lenders to have much greater responsibility, so that if a default is triggered, there should be a process whereby the debtors have access to independent financial advice and the banks are required to offer a range of payment alternatives, which might include shared ownership, for example. The banks will say, Well, that's all in our code of conduct, and indeed it is, but there are plenty of rogue lenders who are not bound by that code and others who do not observe its spirit. My question for the Government is whether they are considering the arguments for and against making the code of conduct binding on mortgage lenders, requiring them to do what is currently regarded as good practice.

Jim Cousins: The hon. Gentleman has spent the past year denouncing the lending practices of banks in the most dramatic terms, using such expressions as close to a scam, irresponsible lending, rubbish mortgages and poor assetsthat was his phrase on Monday night. Now that he is staring the consequences of his own policies in the face and does not like them, his solution is to compel the banks to carry the problem, in the middle of a liquidity crisis, on their balance sheets.

Vincent Cable: I would have thought that the simple logic is that if lenders have behaved irresponsibly, there is an obligation on them to behave more responsibly in future. I will come to the question of how that affects liquidity and the balance sheetquite rightly, because that is part of the argumentbut there certainly should be an obligation on banks that have lent irresponsibly to the people who have borrowed and are now in considerable difficulties.

Simon Hughes: In looking for solutions, may I say that many familiesprobably more in the past year than at any time over the past 25 years in which I have been hereare coming to me with multiple debts and pressures in respect not just of their homes, but of credit cards and the like, which my hon. Friend the Member for West Aberdeenshire and Kincardine (Sir Robert Smith) mentioned, so could not the Government add one other thing to the list? Could they spend a bit of the money that they spend on publicity on helping people to go to the one-stop-shop advice centres that exist, which can consider their position in the round and give them advice that enables them to manage their way out of the problem, rather than just rely on the banks or one agency to help in their sector, while those people are struggling with the rest of their debts?

Vincent Cable: That is a constructive suggestion, which builds on a policy that we have been arguing for. An excellent report was published for the Government a few weeks ago by Mr. Thoresen that developed that point. Unfortunately, like so many other good reports prepared for the Government, it is in danger of sinking without trace, because it requires somebody to take responsibility for rolling out a network of advice, which, as my hon. Friend correctly says, is so necessary.
	The final option that we need to consider is whether, in current circumstances, the Government, or social landlords on behalf of the Government, should act as a buyer of last resort in housing markets that are falling rapidly. In cities such as Leeds and Manchester, there are large amounts of empty buy-to-let accommodation that cannot find a user, quite apart from the properties that have been auctioned off as a result of repossessions. Social housing has been sold off over the past 10 to 15 years, as a result of the right-to-buy policy, but we now need to ask whether that policy should, in some degree, go into reverse, partly as a way of sustaining the market and partly as a way of providing more social housing where it is badly needed. That would clearly require an investigation of the borrowing powers of social landlords. I wonder whether the Minister could give an indication of whether the Government are thinking about that.

Julia Goldsworthy: It might help my hon. Friend if I set that point in context: 1 million fewer homes are now available for social rent than at the time of the last housing market fall. In the last 10 years, we have seen social housing waiting lists rise by 60 per cent., so we are already in a position of high demand, which could get a lot worse.

Vincent Cable: My hon. Friend is absolutely right. That is another reason why the repossession crisis is so severe. It is not just a matter of people not having safety nets; the problem is that there is nowhere for them to go if they are repossessed. They are put into a desperate situation with virtually no social housing. There is an opportunity for the Government to reverse the negative net sale of public housing, which has been so damaging in the past.
	Let me move on to a third area where the Government should be thinking of reform and change. I want to respond directly to the intervention of the hon. Member for Newcastle upon Tyne, Central (Jim Cousins), who correctly said that this problem is linked to the wider issue of the crisis within the banking system. I shall not digress widely into why the banks face a credit crunch, but we all know the essence of the problem: through very complicated financial instruments, debts, including bad debts from the sub-prime market, were bundled up and sold on in such a way that those bad debts can no longer be traced, as a result of which trust within the banking system has collapsed so that banks will no longer lend to each other, except at extreme rates, and the normal function of banking has broken down.
	The question is what the British Government can do about it. This is partly an international problem, but it is also a very specifically British problem, because the City of London is probably the largest financial centre in the world and we are all affected by how its finances develop. What is happeningit has happened over the last few weeksis that the banks are launching a major campaign to get the Bank of England to provide them with cash with minimum strings. What they would like is for the Government simply to advance cash in return for their mortgages, particularly their poor-quality mortgages. That is happening on a very large scale in the United States, where the state is effectively nationalising the losses and risks of the banking system. The banks would dearly love our Government and our authorities to do the same here.
	The Governor of the Bank of England has been taking quite a hard line on that, rather differently from his opposite numbers in the US, and I have a good deal of sympathy with him. However, he and the rest of us are confronted with a practical problemif the banks are to continue to function and the financial system is not to seize up, there needs to be liquidity. The question then becomes under what conditions it should be provided.
	We may well be getting an answer to that question, but I would like to suggest an approach that I believe the Government should support in working with the Governor. By all means let more liquidity be provided in the banking system, which has to function as a lender to businesses and households, but there should be a condition. The condition is that the banks' shareholders should accept the losses that come with bad debt. They will have to do that by accepting what are called write-downs. They will have to do that by cutting their dividend payments, by rights issues, by sales, by forgoing acquisitionsall the sort of things that banks like doing. The are going to have to go through a period of austerity in order to get their own accounts in order. That would be the condition for the advance of liquidity. The banks will hate it; they will run campaigns in the financial newspapers, saying how terrible the Governor of the Bank of England is for being so stingy and not giving them what they want, but in those circumstances it is the job of the Government to provide political support for the Bank of England. The basic point is that our banks are too big to fail, but, equally, they are too big for the Government to bail out all their losses and bad debts. They will have to carry this themselves and they will have to be helped to do it.
	My final point is about the future of regulation. As a result of this crisis, many of the assumptions that underlay the regulation of the financial system in Britain are having to be re-examined. We had a system of so-called light-touch regulation, which has in practice led to major financial institutions in the City behaving irresponsiblybehaving like casinos rather than lenders in many casesand that has to be stopped. In the emergency circumstances of the present, we cannot rewrite all the rules, but to prevent this from happening in future, there will have to be a complete rethink of the way in which our financial institutions are regulated.
	The central change that needs to be made is to recognise that markets operate in cycles. This is not some unhappy circumstance; capitalist economies always operate cyclically. They may be more efficient and may function better at certain times, but they are very cyclical, so the authorities need to ensure that the reserves that banks hold reflect the cycle; in a boom period, they should be required to hold more, and they should be required to hold less in a downturn. The whole process by which financial institutions are managed needs to be much more proactive and much more aware of the cyclical nature of the industry.
	I put forward those ideas in a constructive spirit. I think that if the Government were to address them and come up with positive solutions rather than just waiting for events to happen, they might well avoid the damage that would result if they were simply to relive the experience of the great Tory recession.

Mr. Deputy Speaker: I inform the House that Mr. Speaker has chosen the amendment in the name of the Prime Minister.

Jane Kennedy: I beg to move, To leave out from House to the end of the Question end and to add instead thereof:
	acknowledges the resilience of the United Kingdom economy, which grew faster than any other major economy in 2007 and in which employment is at record levels; notes that the record of economic stability since 1997 has laid the foundation for rising home ownership, with the number of owner-occupier households rising by 1.8 million since 1997; further notes that household finances remain strong, with household assets worth over 7.5 trillion, more than five times the level of personal debt; believes that the United Kingdom is well placed to respond to the challenges arising from the continuing international financial turbulence; applauds the Government for managing the public finances within its fiscal rules; recognises that the Bank of England Monetary Policy Committee has cut interest rates twice in recent months; further acknowledges that mortgage interest rates are currently around half the level of those reached in the early 1990s and that the proportion of repossessions is less than one third of the rate in the peak year of 1991; welcomes the Council of Mortgage Lenders' recent statement, which sets out the steps that the industry is taking to support borrowers facing repossession, including working with debt advisers, pro-actively identifying at-risk borrowers and only repossessing as a last resort; and supports the Government's initiatives to assist home ownership, including new measures to encourage long term fixed rate borrowing and new forms of shared equity.
	It is pleasure to discuss such an important topic. The hon. Member for Twickenham (Dr. Cable) raised a number of points in opening the debate, and I should like to deal with each of them in turn. It is a routine but important courtesy to say what a pleasure it is to follow the opening speech, but it was a sore trial for me to listen quietly and respectfully to the Liberal Democrat party give a lecture on financial probityno matter how scholarly the hon. Gentleman's manner.  [Interruption.] I will say exactly why.
	It is not what the Liberal Democrats say, but what they do in practice and in power that we should examine. Speaking as a Liverpool MP, I know how unfortunate it is for that city and its local economy to be one of the few places under Lib-Dem control and subject to their influence. Despite huge investment from the UK and the European Union, the Lib Dems have virtually bankrupted the city, which is officially classified as the worst council in the country for financial management. The burden of debt is beyond belief and former senior Liberal Democrats have characterised it as doing more damage to Liverpool than Militant. Having got that off my chest, I shall return to the points that the hon. Member for Twickenham made.

Lembit �pik: I am glad to hear that the right hon. Lady will be addressing my hon. Friend's comments, because I am extremely concerned when the Government receive what I think is pretty sage advice, delivered in a non-partisan way, and they respond with lectures about Liberal Democrat policy, which is the last thing that the country needs to hear given that, collectively, we are on the brink of a repossession catastrophe. I hope that the Minister will confirm that she will work on a cross-party basis to try to ensure that the general public whom we servenot the parties to which we belongare given the support that they deserve.

Jane Kennedy: I knew it was a good idea to give way to the hon. Gentleman. I always like listening to his interventions and hearing him urge us to engage in a non-partisan way in an important debate. He is right to make that point. However, it is very difficult to do that in a constructive way with a party that is preaching such doom and gloom, talking up the prospects of a recession.

Several hon. Members: rose

Jane Kennedy: Let me begin my comments in response to the Liberal Democrat motion and then I will happily give way to hon. Members. I do not want to spend as long on my feet as did the hon. Member for Twickenham.
	Let me start with the condition of the economy, before I move on to the housing market more specifically. The world economy is clearly facing its most uncertain period for some time, which is having an effect across the worldand the UK is no exception. However, Britain is in a strong position to cope with the challenges ahead, and it is in a far stronger position than it was at the start of the last decade. Our economy is stable and it has been growing uninterruptedly for more than 15 years. It is true that growth is forecast to be slower this year than last, and slower than we had expected at the time of the pre-Budget report, but Britain's economy is forecast to keep growing. That is not complacency. That is the forecast of not just the Treasury, but the International Monetary Fund, the OECD and the CBI. In fact, independent forecasters expect Britain to be the joint fastest growing economy in the G7 this year.

Simon Hughes: The right hon. Lady is entering a phase that concentrates on the good things that the Government have doneand there have been good thingsfollowing her petulant beginning that ignored any of the good things that my colleagues have done in Liverpool over 10 years. However, I know how anti-Liberal she is, so we understand that coming from her. Does she accept, however, that the burden of the case made by my hon. Friend the Member for Twickenham (Dr. Cable) is that whatever the history and the macro-economics, the over-commitment of British peoplethe over-expenditure with money that they do not haveis now at a crisis? I hope that she will give practical answers so that people outside the Chamber can see that politicians together are helping them to get out of the huge and terrifying financial holes that millions of families are in.

Jane Kennedy: The Liberal Democrats hate it when the spotlight is shone on what they do when they are in power. I never lose any opportunity to shine that spotlight. However, I can assure the hon. Gentleman that I will shortly come to the practical steps that we are taking in government, if he will allow me to get there. I disagree with him; in the context of the debate, we cannot set aside the macro-economic situation in which we are working. That is of central importance and why we can say with confidence that we believe that the economy in the UK is strong enough and stable enough to sustain British home owners and those who want to be home owners through the coming months.

Christopher Huhne: Is the right hon. Lady aware that the housing market has been the source of macro-economic disturbances for successive Chancellors of the Exchequer for certainly 30 years? Merely to brush the problems in the housing market aside as if they do not have macro-economic consequences, which is what I understand her to be doing, would be, frankly, irresponsible. My hon. Friend the Member for Twickenham (Dr. Cable) made some extremely constructive suggestionsthey were not gloom-mongering, as she saidabout underpinning the housing market at a point where it may do serious damage to the Government's macro-economic strategy. I hope that we have a response from her to that point, and not silly tittle-tattle about Liverpool.

Jane Kennedy: The hon. Member for Twickenham was either running around going, We're doomed, we're doomed, or he was saying, Don't panic, don't panic. I cannot quite establish which of the two characters he was casting himself in.
	We have also had relatively low and stable inflation. At 2.5 per cent., consumer prices index inflation is currently lower than in both the euro area and the USA. It is forecast to pick up in the short term, but to return to target from next year onwards. There are also more people in work in Britain than ever before.
	I felt somewhat patronised by the suggestion that Ministers might not know that there was a prediction that unemployment would rise. I was Minister with responsibility for work and remember that the unemployment figures grew slightly when I was at the Department for Work and Pensions. That increase was largely due to moving people in receipt of incapacity benefit on to jobseeker's allowance to help them into work. In case the hon. Gentleman does not know, let me advise him that we have plans to move lone parents on to jobseeker's allowance as a precursor to helping them to find work. It is those active, labour market policies which we have implemented in government that have transformed the experience of families in the UK. It is the labour market's continuing strength that gives us cause for encouragement going forward. He, too, should take comfort from that.
	Our economy is strong and stable. We have seen increasing resilience over the past decade in the face of a number of shocks. Britain used to be the first into recessions and the last out, but at the start of this decade we proved more resilient than any other major economy after, first, the bursting of the dotcom bubble and then the 9/11 attacks on the World Trade Centre. Britain was the only G7 country not to experience at least one quarter of negative growth in the years that followed.
	I think that Britain is in a stronger position to deal with the challenges presented by the recent disruption to the world economy than the hon. Gentleman suggested. We are in a far stronger position than we were in the early 1990s. Back then, unemployment topped 10 per cent., inflation hit nearly 11 per cent., and interest rates rose to almost 15 per cent. That was a hugely different position from the one that we see today after nearly 11 years of continuous growth under this Government and the largest rise in income per head of any G7 country. The differences between today and the early '90s are just as clear when we consider average mortgage rates. Today, the average rate on mortgages is 5.9 per cent. In 1990, it peaked at over 15 per cent.
	Britain is in a far better economic position today than it was in the early '90s, and that is the main reason why I do not agree with the suggestion that the housing market is about to repeat the pattern that it followed then.

Julia Goldsworthy: I am listening carefully to the Minister. Does she therefore discount the evidence from Citizens Advice that the number of people coming to it expressing concerns about their ability to repay their mortgage is up a third on this time last year?

Jane Kennedy: Not at all. It is precisely because we acknowledge that anxiety that we are putting in place the steps that I shall come to shortly.

Christopher Huhne: Will the Minister give way?

Jane Kennedy: I have already given way to the hon. Gentleman. Perhaps he will allow me to make a little progress on the housing market and repossessions, because he urged me to describe what the Government are doing.
	After increasing by more than 10 per cent. in the year to August 2007, the signs are that house price inflation is declining relatively gradually, and prices are still higher than they were a year ago. We should remember that because of the economic stability over the past 11 years there are 1.8 million more home owners in the UK today than there were in 1997. Household wealth is also far higher than it was 10 years ago and total household assets are now worth more than 7.5 trillionmore than five times higher than the level of personal debt, which is growing at its lowest rate for around seven years.

Christopher Huhne: Is the right hon. Lady not, however, concerned that the key indicator for an asset market such as housing is debt service? Is she not concerned that the personal debt service of households in this countrynot merely capital repayments, but capital payments plus interest paymentsis now at the same level that it was at the beginning of the 1990 to 1992 downturn? When she says that so far the fall in prices has been relatively modest, that was also the case at that point then. Will she confirm that fact?

Jane Kennedy: I shall come to individual financial capability, but first I want to address one point in the Liberal Democrat motion. It reads like a Focus leafletor, rather, like a Victorian penny thriller. It is full of hyperbole with few facts. It maximises the fear factor and does not let the truth get in the way of a good story. I shall give an example. The motion
	notes with concern that repossession orders are now at the same level as in 1990.
	If we look at the number of repossessions that are actually taking place, we see that that is not true.

Christopher Huhne: Will the Minister give way?

Jane Kennedy: No, I have given way to the hon. Gentleman a number of times and I want to make some progress. Many other hon. Members want to speak in the debate.
	The number of repossessions in Britain remains relatively small. There were just over 27,000 repossessions in 2007 compared with 75,000 in 1991, despite there being almost 2 million more mortgages today than there were then. Last year, the number of properties taken into possession was just 0.23 per cent. of all mortgages, which is about a third of the rate in the early '90s.

Christopher Huhne: rose

Simon Hughes: rose

Jane Kennedy: I can see that the hon. Member for North Southwark and Bermondsey (Simon Hughes) does not agree. I shall give way one last time and then make significant progress.

Christopher Huhne: The key point is that we are talking about a leading indicator. Orders are a leading indicator of what will happen. The Minister insists on talking about actual repossessions, which are merely a backward indicator. I hope that Ministers can distinguish between leading and lagging indicators when they are attempting to manage the economy; it would be very worrying if they could not.

Jane Kennedy: What the hon. Gentleman has said about orders returns me to the point made by the hon. Member for North-East Bedfordshire (Alistair Burt), who rightly spoke of the impact of a change in the way in which the state supported people who faced mortgage and repayment problems. It meant that mortgage lenders had to be far more interactive in their dealings with people. That is exactly what happens. A court order does not necessarily mean that individuals lose their homes, and banks and building societies now try much harder to use repossessions as a last resort when dealing with people in financial difficulties. Indeed, the regulatory regime requires them to do so.
	As I have said, both interest rates and mortgage rates are far lower today than they were at the start of the last decade, and have increased more gradually than they did then. I do not think it reasonable to compare the present position of the United Kingdom housing market with the position in the early 1990s. I also do not agree with the comparisons drawn by the hon. Member for Twickenham with the United States, where house prices are experiencing significant falls. In fact, there are three reasons to believe that the UK market is better placed than that in the United States.
	First, the falls in US housing prices are being driven by a very large overhang of unsold houses. Here in the UK, by contrast, housing supply is not currently meeting demand. That is why we have a target of more than 240,000 net additional homes a year by 2016. We intend to deliver 2 million new homes by 2016, and 3 million by 2020. Secondly, mortgage lending regulation is stricter in the UK than it is in the US. Many of the regulatory changes suggested in response to the problems in the US market have already been made in Britain. Thirdly, although it is generally accepted that the UK also has a sub-prime mortgage sector, it is much smaller than that in America, where it was seen as the trigger of the current difficulties.
	The Government have taken a number of steps to help ensure that lenders lend responsibly and borrowers can make informed choices, including the statutory regulation introduced in 2004. The FSA's regime places specific requirements on firms to take account of the affordability of loans, and to treat customers fairly. Like the hon. Member for Twickenham, we welcome the recent statement from the Council of Mortgage Lenders setting out the steps that the industry is taking to support borrowers who are experiencing difficulties. They include working with debt advisers, proactive identification of at-risk borrowers, and considering repossession only as a last resort.
	More generally, the Government have been focusing increasingly on improving people's financial capability so that they can make better decisions about how to handle their money. For the long term, we have put aside 11.5 million for personal finance education in schools over the next three years. That will include developing ways of helping primary school pupils to start thinking about money, using their child trust funds to make it relevant to them. From September this year, financial education will also be part of the secondary school curriculum.
	We must think about today's adults as well. Otto Thoresen has been considering the best way in which to ensure that everyone in the country can obtain free, impartial, high-quality advice on money when they need such information. His final report, published earlier this month, recommended a pathfinder project to test the best ways of offering that, and, with the FSA, we have agreed to provide up to 12 million to run it over the next year.

Simon Hughes: rose

Jane Kennedy: I meant to give way to the hon. Gentleman earlier, but his hon. Friend the. Member for Eastleigh (Chris Huhne) jumped in. I will ensure that I give way to him on this occasion.

Simon Hughes: I am grateful to the Minister. As she will have heard, I intervened on my hon. Friend the Member for Twickenham on exactly that point: the need to ensure that one-stop shops are available throughout the country, so that people can go to a single location to obtain advice on a range of debt issues. Can she assure me that the response to the report to which she has referred will not be so extended and protracted that it will be of no benefit other than as a pilot scheme? Will she and her colleagues give serious consideration to an early advertising campaign with maximum reach, providing the addresses of the places to which people will be able to go? Millions of people are in need of free, independent, impartial, sound advice.

Jane Kennedy: The hon. Gentleman has made a sensible suggestion, and we will consider it. The pilot that we propose is a significant piece of work that will make a real difference to people.

Jim Cousins: I am grateful to my right hon. Friend for allowing me to intervene before those set in authority over us send me off to discuss the draft Land Registration (Network Access) Rules 2008.
	The hon. Member for Twickenham (Dr. Cable) has been consistently and relentlessly snobbish about what he calls Together mortgages. As a result of both his remarks and what is happening in the markets, such mortgages are now being withdrawn. That is leaving a large number [Interruption.] It is a great pity that the Liberal Democrats are so snobbish about low-income owner occupation. Low-income home ownership ought to be precious to us, but now that Together mortgages are being withdrawn, a large number of low-income home owners are in real difficulties. What has my right hon. Friend to say to that?

Jane Kennedy: My hon. Friend has made a valid point. I acknowledge the strength of what he has said and the passion with which he has said it. I know that he may have to leave soon, so let me simply say that we are doing a great deal to help people in those circumstances.
	As I have said, free debt advice is hugely important to those who do experience difficulties. For the next three years the financial inclusion fund will be increased to 130 million, and 76 million will be spent on providing free, face-to-face money advice. There is also targeted support for vulnerable people through support for mortgage interest, which provides a backstop for some people who have fallen out of work. It helps about 200,000 people each year to cope until they can return to employment.
	I want to make three main points. First and most important, Britain's economy is in a strong position. It is stable, it is continuing to grow, a record number of people are in workfor which I give thanksand we have seen over the last decade that it is more resilient than it has been in the past. The present position is very different from the position in the early 1990s.
	Secondlybecause of that different economic positionI do not agree with the hon. Member for Twickenham's predictions of a house price crash and a huge increase in the number of repossessions. House price inflation is declining, but it is doing so relatively gradually, and house prices remain higher than they were a year ago. Although the number of repossessions is expected to rise a little in the year ahead, they remain far below their levels at the start of the last decade.
	Finally, the Government are continuing to take action to ensure that people are able to make better financial decisions, and to ensure that support and advice are available to those who do get into difficulty.
	I urge Members to oppose the Liberal Democrat motion, and I commend the Government's amendment to the House.

Mark Hoban: The hon. Member for Twickenham (Dr. Cable) managed to paint a very bleak and gloomy picture of the economy and the housing market, and he was helped to paint that picture of doom and gloom by his hon. Friends. The hon. Member for North Southwark and Bermondsey (Simon Hughes) spoke of a huge and terrifying financial hole facing millions of families, while the hon. Member for Montgomeryshire (Lembit pik) said that people were on the brink of a repossession catastrophe. Language like that does little to help home owners. We do not want to be seen to be talking down the housing market. People's hopes and aspirations rest on it, and it is irresponsible and opportunistic to whip up an air of crisis and panic.

Mark Hunter: The hon. Gentleman makes great play of Liberal Democrat Members' concern about the increasing number of repossessions. Is he aware that in my areato give just one examplethe repossession rate is currently running at 10 per cent., which is twice the national average? Does he not think that a repossession rate of 10 per cent. is something to be concerned about?

Mark Hoban: I think that every Member of this House is concerned about repossessions and the fact that people across the country are at risk of losing their homes. However, we should address this issue reasonably and rationally, instead of seeking to talk down the housing market and create an air of panic.

Lembit �pik: rose

Christopher Huhne: rose

Mark Hoban: I shall give way to the hon. Member for Eastleigh (Chris Huhne).

Christopher Huhne: I am grateful to the hon. Gentleman for giving way, not least because he is my neighbouring MP and as a result we share the same county courts in respect of repossessions. Is he aware that repossessions in southern Hampshire and the county courts of Southampton and Winchester are up by more than 20 per cent. over the past year? Does he not regard that as a matter of considerable concern, as I do? I hope he will not be complacent about the considerable personal suffering involved in those horrifying figures.

Mark Hoban: No, I will not be complacent about that, but I think we need to look at this matter objectively and carefully, instead of being irresponsible and seeking to create an atmosphere of panic and chaos, which is what the Liberal Democrats have done. The Financial Secretary has gone in the other direction: she sought to paint a much more rosy picture of the economy than the reality warrants and overstated the case, but she has minimised some of the legitimate concerns people have about the current state of the economy.
	Too often over recent months, all that we have heard from the Government is that all our problems have been caused by the global credit crunch. It is typical of this Government that they take the credit when times are good, but shift the blame when times are harder or more uncertain. The challenge in any crisis is how to handle it. It is a hallmark of good government to be prepared for a crisis and take control, rather than be buffeted by events.
	We saw yesterday at the Prime Minister's weekly press conference that he has no room for manoeuvre. He was looking to others to bail him out of a situation he has created for himself. He was encouraging the Bank of England to cut rates to boost growththe Bank of England that he made independent. He has set an inflation target for the Bank, but he was looking for it to put that target to one side. He also called for the European Investment Bank to offer loans to businesses.
	The reality is that the Prime Minister, having mishandled public finances for the past 10 years, has no room for manoeuvre. Unlike Governments elsewhere in the developed world, he cannot offer tax cuts to help hard-pressed families or to lift the burden on businesses, because this month we are seeing increased taxes on families, small companies and wealth creators. So at a time when families are facing economic uncertainty, they cannot expect the Government to help them. There is no denying the fact that families are facing economic uncertainty; I accept that. People need to use more measured language, however. Interestingly, the hon. Member for Eastleigh used far more measured language than his colleagues on this issue. Perhaps he is auditioning for another part in the future.

Lembit �pik: rose

Mark Hoban: I shall give way to the hon. Gentleman, as I named him earlier as someone who was creating and then stoking up that atmosphere in the housing market.

Lembit �pik: I am grateful to the hon. Gentleman for flattering me by saying I have such awesome power over the British economy. Perhaps my party does not need to be in government, and instead we can just run the country from the Opposition Benches.
	Given that the hon. Gentleman seems to be striking a middle way between our position and the Government's, I am at a loss to know whether he will vote for the Government amendment or have the courageof our convictions, certainlyto stick up for the people who are suffering in the housing market and vote for the Liberal Democrat motion.

Mark Hoban: I am not sure I would ever look to the hon. Gentleman for guidance, and certainly not on how to vote, as I think that so far he has not backed a single successful candidate for leader of the Liberal party.  [Interruption.] He refers from a sedentary position to the right hon. Member for Sheffield, Hallam (Mr. Clegg). I read part of the  GQ interview this week. I do not know whether the hon. Member for Montgomeryshire wants to share his experiences of running for office. I shall move on, however, Mr. Deputy Speaker, as I suspect you would like me to do so.
	Despite cuts in the Bank of England's base rate, many families' mortgage repayments will increase when more than 1 million fixed rate or discounted deals come to an end this year. The widening gap between the base rate and the LIBOR is a sign of continued uncertainty about and a current lack of trust in the financial markets. That means that home owners will not necessarily receive the full benefit of recent base rate reductions.
	In addition, the restriction on the availability of credit means that lenders are tightening their conditions. For example, the Co-op has cut its maximum loan-to-value ratio from 95 to 90 per cent.; and the Nationwide's subsidiary The Mortgage Works has withdrawn its offer of 100 per cent. mortgages, as has Scottish Widows which yesterday withdrew its 100 per cent. mortgage aimed at young professionals, who will now have to find a deposit. First Direct closed its mortgage business to new customers because it could not process the volume of applications it received. The problems in the global credit market therefore mean not only that customers will face higher rates when existing deals come to an end, but that credit itself is being rationed through tougher rules and conditions. Those with equity in their homes or with substantial deposits may well be able to meet tighter conditions imposed by lenders. For those without either, existing mortgage customers will be forced to stay on relatively high standard variable rates, and those aspiring to get on the property ladder will have to save for longer.
	In times of economic uncertainty, people naturally turn to the Government for help and they hope that the Government will do something to lift the tax burden from them or will understand that costs are rising. However, because this Government failed to prepare for difficult times, no relief is on offer. Last month's Budget saw taxes increase on alcohol and new carstax increases that are in place to plug the hole opening up in the Chancellor's numbers, and that will raise the cost of living as well as take money out of families' pockets. Also, this month we will see tax increases such as the scrapping of the 10p band.
	The hon. Member for Llanelli (Nia Griffith) certainly understands what is happening, judging by an article in  The Guardian today. She said:
	We have always wanted to support those on lower incomes, we have done an enormous amount with things like the minimum wage to raise people out of poverty
	and
	I think therefore anything that hits people on lower incomes is perhaps something we are particularly sensitive to in the Labour party.
	I think the hon. Lady had a point.
	Apparently, the Prime Minister claimed that no one would be worse off as a consequence of scrapping the 10p rate, but that is certainly not the evidence that was given to the Treasury Committee in its inquiry into the 2007 Budget. The Exchequer Secretary to the Treasury was a member of that Committee, and I think signed off the report that was published. Robert Chote of the Institute for Fiscal Studies said in an evidence session that 5.3 million families would lose out as a consequence of the scrapping of the 10p rate, and Mark Neale, managing director of the budget, tax and welfare directorate at the Treasury, said that
	the figures that Robert Chote gave you are in the right ball-park.
	Therefore, many people will be worse off as a consequence of the scrapping of the 10p rateolder pensioners, and many couples and single earners without children. No Labour Member should be fooled by the Prime Minister's reassurances of earlier this week. The change will hit their constituents, and mine, hard.

George Mudie: I do not know whether the hon. Gentleman has spoken to Robert Chote since, but at a presentation in Parliament on this year's pre-Budget report he put the figure much lower. He has seriously reduced the number of those who would lose because of the scrapping of the 10p rate. Will the hon. Gentleman make arrangements to meet Robert Chote?

Mark Hoban: I am always happy to meet Robert Chote, who came up with some important figures. Interestingly, when the then Chancellor was quizzed last year, he was unable to refute them. Last year, when the Treasury put the policy forward and it was announced in the Budget, it also regarded those figures as being in the right ball park. The figures may have changed, but last year's decision was made on the basis of 5.3 million families losing out as a consequence of scrapping the 10p rate.

Julia Goldsworthy: Does the hon. Gentleman agree that although there may be some variation in the number of people thought to be affected, the income profile is most likely to be those who work part time, those on low incomes, and single people under 25 without children who are not eligible to benefit from the changes to the tax credits?

Mark Hoban: The hon. Lady has produced a reasonable and helpful analysis of the people who will lose. Female pensioners in their early 60s are the group in my constituency who are particularly concerned and vocal about this matter. A number of groups will be affected, so for the Prime Minister to brush aside the impact, as he appeared to do at Monday night's parliamentary Labour party meeting, is to seek to minimise an important and growing concern for our constituents.
	Not only is the 10p rate being scrapped, but taxes are increasing on wealth generators, small companies' tax rates will be increased again and entrepreneurs will be hit by an 80 per cent. increase in the capital gains tax they pay on selling their businesses. That is hardly a move designed to encourage new business investment and formation at a time of economic uncertainty.
	While our competitors used 15 years' global economic growth to prepare for difficult times, the Prime Minister, who was the then Chancellor, taxed, spent and borrowed his way to a position in which our deficit exceeds that of our EU counterparts. Even Italy has a lower budget deficit than UK. It seems that prudence, which was a feature of his first Budgets, has left the UK and is happily living in Tuscanya place that seems to be one of relative fiscal rectitude compared with the UK. While our competitors can use their reserves to pay for tax cuts, Britain has no such luck.
	Of course, it is not just bad decisions on tax and borrowing that have created some of the problems in the housing market. It is a pity that the Chief Secretary to the Treasury is not in the Chamber this afternoon, because in her former role as a Minister of State with responsibility for housing she was the mastermind behind one of the biggest cock-ups in the housing market for many generationshome information packs. They have had an impact on the housing market. Their early introduction has led to concerns about the number of properties coming on to the market and the additional costs that they will impose on home owners. They are part of the problem in the housing market, and people are rightly expressing concern about them.

Alistair Burt: Before my hon. Friend leaves the topic of the Chief Secretary, perhaps he will persuade one of the Ministers present to give us a statement that the Government have so far not given us. Why was the chief executive of the Thames Gateway project sacked barely a year after her appointment by the Chief Secretary, whereas she received a promotion following a series of reports on the Government's poor handling of that project?

Mark Hoban: My hon. Friend makes an important point. I have yet to work out how competence and promotion work in this Government. It is a mystery to us all, but perhaps the Exchequer Secretary to the Treasury will be able to explain it in her winding-up speech.

Angela Eagle: That was way above my pay grade.

Mark Hoban: The Exchequer Secretary says that it was way above her pay grade, but of course it was not way above her pay grade at the time to recognise that 5.3 million households were going to lose out as a consequence of scrapping the 10p rate of income tax.
	Before we got slightly distracted, we were discussing the impact that the introduction of home information packs has had on the housing market. It is not surprising that  Which? has said:
	The new 'half-HIP' will be a useless but a very expensive waste of time...This half-baked compromise will result in something that is of little value but of real expense to consumers and Which? cannot therefore continue to provide support.
	One can always rely on  Which? to come up with a pithy judgment: one of its former directors, who is now a No. 10 employee, said:
	Gordon Brown doesn't need a new speechwriter. He needs a magician.
	As one can see,  Which? is very good at identifying the issues in consumer problems; it does not always identify the solution, but it identifies the cause of the problem.
	The Government's interference in the housing market has not helped the situation. The poor state of the housing market, a squeeze on the cost of living, and higher taxes and higher borrowing costs make it more difficult for families to make ends meet, and could therefore lead to higher levels of repossessions. The rise in stamp duty revenues, which has been such a godsend for the Government's tax take, has become a problem for first-time buyers, who now pay an average of just under 1,700.
	When lenders were more relaxed about multiples and were happy to combine secured and unsecured loans, such as with the Together loan, which has been the topic of debate over recent months, first-time buyers could roll stamp duty up into their mortgage but now, with tighter rules and lower loan-to-value ratios, they will need to fund stamp duty up front. That will add both a further barrier to their buying their first home and another brake on the housing market. That is why we announced last October that we would abolish stamp duty for first-time buyers on properties costing less than 250,000, which would mean that nine out of 10 first-time buyers would no longer have to stump up for stamp duty. That would offer practical help for first-time buyers.
	As I said, we need to be wary about talking down the housing market, but we must recognise that conditions are tough and we must strike the right balance in this debate. The combination of higher taxes, lower real earnings, a tighter housing market, higher mortgage interest rates and tougher conditions on home loans creates uncertainty and difficulty. People whose fixed-rate mortgages are coming to an end particularly need to look at the options available to them. They need to find the best deal available and secure it before they flip on to the default option of the higher standard variable rate.
	The pressure of higher mortgage rates and rising living costs will mean that more families will find it harder to make ends meet, but given the relative ready availability of consumer credit, people must avoid the temptation to pay for everyday essentials using their credit cards, as that could lead to further problems. People facing financial hardship should seek advice sooner rather than later so that they can take control of their financial affairs, rather than allow someone else to do so at a later stage when their situation has deteriorated. Services such as Citizens Advice, the Money Advice Trust and the Consumer Credit Counselling Service all offer advice to people struggling with their bills.
	The scale of any problems will depend in part on the overall economic circumstances. Four key factors have driven economic growth in recent years: finance, housing, public spending and immigration. Finance has grown four times as fast as the economy as a whole; housing has grown twice as fast as the economy as a whole; and the size of government has grown a third more than the economy itself. So the credit crunch will have a growing impact on the fast-growing financial services sector. That factor was borne out by yesterday's CBI survey of employers in that area: future job losses in the sector were predicted, as was the impact on housing of the tighter availability of credit. Both those factors will impact on tax revenues in the year ahead.
	Problems are potentially on the horizon, which is why we need to broaden the base of economic growth and encourage a series of reforms to get the economy back on track again so that we have broader base of growth in future. Because the Government failed to prepare for a rainy day, they have been forced through necessity to rein in the growth of public spending below the rate of growth of the economy as a whole. We have that policy by conviction; it is the sort of policy that allows a Government to prepare for a rainy day.
	We are heading towards difficult and uncertain times, but the hon. Member for Twickenham has done hard-working families no favours by talking up the problems in the market. Having said that, we cannot afford to be complacent either. The Government have failed to prepare the economy for these times and they have let the public finances get out of control. While our competitors can cut taxes to support families and businesses, this Government have had to raise them. Householders see the rising cost of living and increased mortgage payments, but they cannot expect the Government to help, as this year's Budget showed. It included tax increases on alcohol and cars, and the scrapping of the 10p rate. This Government have let our families down at a time of uncertainty by failing to prepare. They will pay a price for that.

George Mudie: I think I understood why the Minister was upset with the Liberal Democrats about the motion. They have done the serious subject of repossessions no service through the motion. For example, the Conservative shadow Minister spoke for 20 minutes, 15 minutes of which concerned the economy, but because of the careless, lazy ritual and the Punch and Judy system that we have

Vincent Cable: indicated dissent.

George Mudie: It is all right for the hon. Gentleman to shake his head, but it is lazy and it has played into the hands of the Minister and the Conservative shadow Minister. It has taken valuable debating time and taken the Conservatives, in particular, away from discussing the problem and putting suggestions forward, which was what the hon. Member for Twickenham (Dr. Cable) did. That is outrageous. The title given in the Order Paper for the debate is The economy, repossessions and the housing market. If the object of the exercise is to deal with the emerging problem of repossession, which hon. Members in their constituencies know to be a real problem as they sniff the wind, speak to people and attend surgeries, the hon. Gentleman and his partyor whoever wrote the motionare not doing us any service by lumping it in with the economy. The motion allows us all to have a ritual run around the economy. I think that the Minister was right about the motion.
	I do not tend to view politics from London or this Chamber. I prefer to consider politics through the constituencies. I do not see how anyone can table a motion that suggests that we are nearing a recession and that we are in all sorts of economic gloom. I used to sit on the Opposition Benches, and Members were accused of talking down the economy. I can see now, from the Government's point of view, where that sort of mood comes from. There is an element of talking ourselves into trouble by talking down the economy.
	If the hon. Member for Twickenham wants to suggest that we are near a recession, he should remember that during the recessions that we had before the Labour Government took over, some 3 million people were unemployed. The hon. Gentleman dug around the Red Book and suggested that unemployment would possibly grow by 200,000, which would take the figure to 1 million, but such a figure is far different from 3 million unemployed, which caused such misery in our communities. We are still trying to dig ourselves out of that misery, even after 10 years of this Labour Government.

Julia Goldsworthy: I have been looking at the motion tabled by my right hon. Friend the Member for Sheffield, Hallam (Mr. Clegg) and my hon. Friend the Member for Twickenham (Dr. Cable), among others. It does not predict a recession as a certainty, but simply notes that there is a risk of recession. That risk has been identified by JPMorgan and Lehman Brothers: is the hon. Gentleman disagreeing with them?

George Mudie: The Minister read out fairly and factually the forecasts from a range of sources: the private sector, the Treasury and the CBI. I have seen no forecaststhe Treasury Committee certainly did not hear of one from any of the experts who came to usthat suggest that we will not have growth this year and more growth next year. The argument, of course, is that we will have lower growth than was forecast last year, but it is still growth. I cannot see how anyone can come to the House and say that there will be a recession when the Red Book, the private sector, the private commentators and the private forecasters suggest that there will be growth. They suggest different degrees of growth, but it is still growth. Where does the risk of recession come in? There is always a risk of recession, but we are now talking about the economy rather than housing repossessions.
	The hon. Member for Twickenham was in the Labour party at some stage in his career, at a time when every motion had to be scrutinised because we all knew that motions mattered. People would table motions and say, You don't want to pay any attention to that. That is probably why the hon. Gentleman left the Labour party. Some of us, with the Minister, fought on to make it the great party that it is.
	Words do matter and it does not help people who have a real problem if, when we have the opportunity to debate that problem, we obscure it by allowing the Opposition off the hook with a long preamble about a mythical state of recession.

Mark Hunter: I have listened carefully to what the hon. Gentleman has had to say. He makes an important point about the tone of the debate, but because he makes that point I, like many Opposition Members, am not clear about what specific point in the motion he does not agree with. Is it the point about rising levels of personal debt? Is it the point about the slowdown in the UK housing market? Is it the point about the number of people requesting help because they are concerned about mortgages and repossessions? What is the exact point in the motion with which he does not agree?

David Wright: They are talking down the economy.

George Mudie: I am primed by my hon. Friend, who is seated on my left, to say, Talking down the economy, but I would not say that. I can tell the hon. Member for Cheadle (Mark Hunter) that I object to the fact that we have had days of debate on the Budget. He was not with the hon. Member for Twickenham and me last nightperhaps it was the night beforewhen we debated the economy and Northern Rock for an hour and a half. The hon. Member for Cheadle had gone back to bed by then. The economy has had more airtime over the past few months than we would wish, but people outside are in danger of losing their homes, which is the most traumatic thing that could happen to most people and families in their lifetime. The Liberal Democrats, through careless framing, have allowed the Conservative shadow Minister to spend three quarters of his time running around the economy and only five minutes dealing with repossessions. They have allowed the Minister to spend a fair amount of time, as she has a responsibility to do, rebutting the lazy and careless framing of the motion on the economy. I do not think that that is sensible.
	I want to speak quietly and seriously about the emerging worry about a credit crunchthe Opposition can blame Government and the Government can blame this or thatthat has come from America, which is affecting and has affected the economy, particularly the financial sector. Like a virus, it is continuing to mutate so that when we think we have the measure of it and will be able to deal with it, it moves on. We are seeing that mutation and those worries. It is not a question of sub-prime mortgages. As we sit here, 2 million people have mortgages that they took out in 2006 which will run out.
	I do not know whether hon. Members or the Minister have read the example given in the Library notes. A young couple with two children from Northamptonshire, who are both working, have been caught out by this problem. Their mortgage runs out this year, and it is with Northern Rock. One would think that, with it being nationalised and owned by a Labour Government, there would not be any troublesomething else that we discussed the other night. Northern Rock is operating very fiercely, however, like other building societies, because it does not want the business. The credit crunch has mutated and moved on, and mainstream building societies and banks are finding it difficult to get money to service mortgages. When a mortgage is up, they are encouraging people to move on. They are doing so in a pretty bad way: the offer that pulled people in disappears.
	A particularly appropriate point was just thrown away by the hon. Member for Twickenham. It is outrageous that the very same building society or bank that brought someone in with a low mortgage has often encouraged them to take a further loan that is not secured. The hon. Gentleman indicated that such loans are now not just a couple of per cent. on top of what people were paying for their mortgage, but can shoot up to about 15 or 16 per cent. The young couple that I mentioned were hit with a double whammy. Their mortgage is going up by 200 a month, which is about 40 to 50 a week. To a young couple with a young family, every penny matters, and that bill comes on top of something that is outside the control of anyone in central Governmentenergy and food costs. They have to pay the extra 40 to 50 a week on that part of their mortgage, and 15 to 16 per cent. on the capital sum that the institution giving the loan was so anxious for them to take. When the deal runs out, people discover that that institution does not want them, and that there is a heavy penalty for staying with it.
	I thinkno, I do not think, I knowthat that is happening. The word on the street is that two months ago, there were 100 main mortgage lenders. There are now 20. Nobody is anxious to pick up mortgages, so they are being shuffled around. Just yesterday, as we have heard, First Direct stopped giving mortgages because it was overwhelmed by the number of people coming to it. It just put a block on them. That takes us back to times that elderly Members on the Opposition Front Bench will remember [Interruption.] I mean the Conservative Front Bench. They will remember when people used to have to get in a queue for a mortgage, and had to save with the institution for a period of time to prove that they were good customers. Even the young fellow on the Opposition Back Benches, the right hon. Member for North-West Hampshire (Sir George Young), remembers those days. We are getting to that stage now, and it is very worrying.
	Advice is a good idea, but although it is easy to give and relatively non-costly, I always worry about whether it gives a solution to a young couple such as I have mentioned. How will they get through the coming months and keep their family intact? That is the problem that we have.
	A lack of liquidity is affecting the banks and building societies. The Governor of the Bank of England has referred to it. A month ago or so, he thought that the financial economy had a problem but that it would not move into the real economy. It is now in the first stages of moving on into the real economy, and it is doing so in housing. Youngsters and families are having difficulties, and I say to the Minister that those difficulties will grow. At the moment, we can be calm and think that the situation is under control, but we should look a few months ahead. If the situation continues, repossessions will move at a rate. We should be considering and discussing measures to take to nip that in the bud, so that we can get through this temporary period of credit crunch and liquidity crisis, and keep people intact in their own homes.
	The hon. Member for Twickenham mentioned the business of social security. One thing that the Conservative Government did was to ensure that, if someone lost their job, they could move on to income support. As part of that, the interest payment on their mortgage was met. That Government ruled that for a person to be eligible, they had to be unemployed for nine months. The trouble with that in relation to mortgages is that most building societies or banks make a move after three months of non-payment. The hon. Gentleman seemed to suggest that the Government should restore the nine-month provision, but that might not be appropriate in the current financial crisis. What would be appropriate would be for building societies to agree not to take action against an individual for nine months, unless a lack of equity in that person's home made the problem impossible to get around.
	I ask the Minister to imagine a situation whereby the young couple mentioned in the Library notes continued to pay their mortgage and then got hit with this problem, perhaps because one of them lost their job. They would not be helped for nine months. I have a history on this matter: I raised it with the Governor of the Bank of England when he first came before the Treasury Committee to talk about the credit crunch, last September. He makes a shop steward in a shipyard look weak in terms of demarcation, and he told me, This is not my responsibility. I still pleaded with him to say whether something could be done in financial circles, because the way the market was going was obvious. We have obviously had no luck.
	The Government have set up a working partya review, I suppose we would call it. The trouble is that it is not [Interruption.] I am not sure whether the signal that I have just received was to keep going or to sit down. I shall sit down. One never knows with the usual channels.  [Interruption.] Thank you. If my hon. Friend the Member for Motherwell and Wishaw (Mr. Roy) had given me that message some time ago, he would have saved me a lot of work.
	The working party has two faults: it is not reporting for the purposes of the pre-Budget report in the autumn, and it seems to me that it is preoccupied by the Government's preoccupation, which is long-term mortgages. That might be good, but let us park it up somewhere for the moment, because it is not too useful in the present circumstances. I rather fear that the working party's main preoccupation is how to get such mortgages accepted and deliver them. If we are to have a working party of all the financial people, I plead with the Minister to get it to shove that work aside and do some quick work on the looming crisis. That would allow us to do things without necessarily baling out or calling on Government expenditure.
	One criticism made by both Labour and Conservative Members was that the Bank of England and its Governor did not act when the credit crunch started and we had the Northern Rock crisis. Unlike Bernanke and the Fed, and even unlike US Treasury Secretary Paulson, there was no sign in this country that anyone thought it worth getting the interested parties together for the sort of beer-and-sandwiches meeting that happened under Harold Wilson. At those meetings, heads were knocked together and people were told that they could not leave until a solution had been found. We did not do that with Northern Rock, and we have regretted that. I think that, in the interim, the working party should be reconstituted, and that its members should kick around possible solutions to a crisis that I hope the Minister realises is very serious.

DEFERRED DIVISION

Mr. Deputy Speaker: I have now to announce the result of a Division deferred on the motion relating to banking.
	The Ayes were 124, the Noes were 322, so the motion was disagreed to.
	 [The Division List is published at the end of today's debates.]

Repossessions and the Housing Market

Question again proposed .

George Young: It is a pleasure to follow the hon. Member for Leeds, East (Mr. Mudie), who is a formidable and knowledgeable member of the Treasury Committee. Unlike him, however, I will need no prompting about when to sit down, as I propose to make a relatively short contribution. The best bit of his speech was when he described the pressures facing an ordinary family: already hit by rising fuel and food costs, such a family could now be forced to come off a fixed-rate mortgage in favour of a more expensive standard rate loan. That simply adds to the problems confronting them and in some cases could lead, sadly, to repossession.
	I want to focus my remarks on the second and third legs of the debate titlerepossessions and the housing market. We have heard about the impact of the banking crisis on the housing market, and there have been some powerful speeches about those who face repossession and those who cannot afford to make their mortgage payments. I want to focus on some of the less obvious casualties in the housing market, namely those who look to the social housing sector for a solution to their housing difficulties. They are also tied up in this crisis and, paradoxically, their numbers will be swollen by those who find that they are repossessed and those for whom home ownership is no longer a practical possibility.
	There has been a fundamental change over the past 25 years in how we fund social housing. If we had had this debate in the early 1980s, the trends that we have been talking about this afternoon would have had no impact at all on social housing, because the Government used to give local authorities powers to borrow, and they built local authority homes. Alternatively, the Government gave grants to housing associations that went on to build housing association properties. So in those days the social housing market was insulated against the broader trends that we have discussed this afternoon; the liquidity problems in the banking sector would have had no resonance in the social housing sector.
	That has all changed today, for two principal reasons. First, housing associations now have to borrow significant sums from the banks. Secondly, social housing is now a by-product of market housing. Some 48 per cent, of the Housing Corporation's programme of affordable homes is being delivered through section 106 of the Town and Country Planning Act 1990, on the back of market-led housing. As a result, it is dependent to some extent on a buoyant housing market.
	Let me deal with that point first. On a typical new-build site, where a private developer is building market homes, 25 or 30 per cent. of them have to be affordable. That form of provision has many advantages: it provides mixed developments rather than the polarised ones that we had in the 1960s and 1970s, and it also saves the taxpayer a lot of money because the cost of providing social housing is, in effect, borne by the land owner, who makes slightly less of a windfall gain. Using the planning system to generate affordable homes is an enlightened policyintroduced, by the way, by the previous Conservative Governmentthat has enabled many people to access decent homes far more quickly than under the old system.
	However, that use of the planning system also has a downside. Far from being insulated against the broader housing market, social housing is now, crucially, dependent on it. My concern is that the softening of the broader housing market will mean that the target of 3 million new homes, and the social housing component of that target, will not be achieved. If one looks at the annual reports and the share prices of the country's major house builders, and at the comments of the Council of Mortgage Lenders, one finds that the outlook for housing is not good. That means that the outlook for social housing is not good either.
	That brings me to the second factor: the reliance by housing associations on private finance to top up the Government grants that they get to deliver the housing programme. The National Housing Federationthe housing associations' trade bodyis aware of the considerable challenges faced by housing associations in the current financial climate. Between now and 2011, housing associations will have to borrow 16 billion of private finance to provide 155,000 new affordable homes, on top of the 8 billion of grant. I do not want to be over-dramatic about that, as housing associations are well run, regulated bodies that remain attractive prospects for lenders who want to retreat to quality investment. While there is no sign of lending supply drying up, some lenders are withdrawing from the housing association market and the cost of borrowing is rising.
	As a result of the credit crunch there is more competition for finance. Lenders report that they are becoming much more selective, and it is inevitable that individual housing associationsespecially those with less attractive risk profileswill find it difficult to raise the money to sustain the build programme. The Council of Mortgage Lenders has warned the Housing Corporation not to push associations to build at all costs amid growing uncertainty in financial markets. Andrew Heywood, deputy head of policy at the CML, has said that, in the short to medium term, there is no certainty about the lending capacity of the banks. He added:
	In this situation it would be important for the Housing Corporation to remember its fundamental role as an independent regulator primarily concerned with the viability of housing associations, rather than with attainment of external development targets at all costs.
	In response, the Housing Corporation said:
	We are keeping the position of individual associations under close review to ensure that services to existing tenants are not put at risk from development activity.
	Several housing associations have been told by lenders, after deals were agreed in broad outline, that the price of the borrowing would go up. Signs that the property market has peaked will make it more difficult for those housing associations that top up their building programme by selling houses to maintain momentum.
	This morning, I contacted one of the larger housing associations in my constituency to get a report from the front on how those broader problems are having an impact. I was told that all the funders were being very cautious, with some having stopped lending while others were looking at selling on their mortgage books, or were putting up margins by varying degrees. As a result, the biggest problem would be for housing associations that would be looking to raise more money because their facilities needed reviewing or increasing. The conclusion reached by the housing association that I contacted was that, if the crisis goes on much longer, it will start to impact on the sector's ability to purchase sites and property from the private sector.
	My point is that it is not just the private housing sector that is affected. The social housing sector is also affected. If the Government want to hit their 3 million target, they may have to act to maintain their social housing programme. They do not have much headroom on the public finance side, and we have not yet reached the stage where dramatic action is needed, but it would be prudent for Housing Ministers and the Treasury to have some contingency measures up their sleeves. Such measures may be needed to maintain the momentum in the housing programme and if we are to hit the housing target, which I am sure we all want to happen.

Lembit �pik: I was very interested in the earlier contribution from the Minister. I like her; she did a good job in Northern Ireland as I guided her towards securing peace there. That is no more of a claim to power than what has been foisted on us from both sides of the House this afternoon, but all the negativity that the right hon. Lady showed makes it clear that she seems to have a real downer in the Liberal Democrats.
	The Minister has nothing to fear from the contributions made by me and others this afternoon, as we are trying to offer insights and, I hope, some sage counsel. Any self-respecting Government should take such offerings seriously, regardless of their source. Getting help and support from us is nothing to be embarrassed about, and it should not be shunned. Indeed, the Minister should be proud that we are offering the advice for nothing. If she were to meet Liberal Democrats socially, I am confident that she would quite like us. The crucial point is that the observations made by my hon. Friend the Member for Twickenham (Dr. Cable) are right, regardless of party position, because they are based on the facts of the current economic situation.
	The hon. Member for Newcastle upon Tyne, Central (Jim Cousins), who had to go to another event, to some extent underlined the power that we Liberal Democrats have by suggesting that my hon. Friend the Member for Twickenham was single-handedly responsible for the collapse and withdrawal of the Together mortgage scheme. That is power indeed. Perhaps most interesting of all was the way in which the Minister, who sadly is not in the Chamber at the moment, likened my hon. Friend the Member for Twickenham to Private Frazer in Dad's Army. She suggested that he was effectively saying, We're all doomed. To take up that analogy, she surely takes on the role of Corporal Jones by suggesting that we should not panic.
	I cannot resist suggesting that the hon. Member for Fareham (Mr. Hoban) has taken on a Vicky Pollard role, as his party's position this afternoon is Yeah, but no, but yeah; I still have not got a clue whether the Conservatives will vote with the Liberal Democrats or support the Labour party. That is a bit of intrigue and excitement to look forward to. On the subject of the Conservative position, I must correct something that he said about my choice of leadership candidate. He is right that I had a bit of a bad run of supporting unsuccessful leadership candidates, but my right hon. Friend the Member for Sheffield, Hallam (Mr. Clegg) is so good that I backed him and he still won.  [Interruption.] I am willing to give way the hon. Member for West Chelmsford (Mr. Burns); I did not hear what he said from a sedentary position, but I am sure that it was very entertaining. Perhaps he should quit while he is ahead on that one.
	The hon. Member for Fareham went on to claim that my words are so powerful that the very utterance of the phrase brink of repossession catastrophe will cause such a catastrophe to happen. If that is the case, I must be more cautious about my predictions that we will be hit by an asteroid. In practice, the prediction is not the same as the event. The purpose of the Liberal Democrats calling for today's debate was to try to avert a repossession catastrophe by trying to get the Government to take a cross-party attitude, rather than a partisan bunker mentality, towards a problem that is obviously coming our way. Perhaps that was optimistic of us, in light of some of the comments made today.
	I was interested in hearing what the Conservative position was, butI do not mean this in a rude way; it is just an observationit seems that the Conservatives have a series of bits-and-pieces ideas, but no clear philosophical narrative to their housing and economic policies. That is the case in other policy areas, too. They can tell us what they do not like, but I have no idea what economic policy on repossessions in the housing market would be if the Conservatives were in charge. Perhaps we will hear that narrative in the speech of the hon. Member for Fareham, which will immediately follow mine, but I fear that we have not heard that narrative because there is not one. I shall reserve judgment until we hear what the hon. Gentleman says in about 10 minutes' time.
	The hon. Member for Leeds, East (Mr. Mudie) spoke in an erudite, insightful way, as ever. He berated us for talking about the risk of recession, but what kind of debate will this be if we are censored, and prevented from discussing the real and present danger of a recession in this country? I have some disturbing statistics from my constituency. Between 2006 and 2007, average wages in my constituency went down, for the first time in years, by 4 per cent. That is not even a real-terms decrease; it is an absolute decline. The constituency of Montgomeryshire is therefore already displaying signs of recession. We ignore such statistics at our peril. If we take the mature attitude that my hon. Friend the Member for Twickenham has consistently taken in debates on the economy, we will collectively consider the issues and move forward.
	Repossessions are rife and are on the up. They, among other leading indicators that we discussed, are harbingers of the doom that we were accused of spreading. Each of us has specific examples from our constituencies, where repossessions and problems with finding housing are arising all the time.

Julia Goldsworthy: I have two examples from my constituency that may inform my hon. Friend's further comments. First, the local citizens advice branch informs me that it is concerned about the number of people who turn up in court for repossession hearings having not sought any advice at all. Does that not underline how important it is that advice is made available when people first experience difficulties? Secondly, it is not just mortgage lenders who are serving repossession notices. Some councils are now serving repossession orders for arrears of council tax. That is of great concern. There are pressures from all sides putting people's homes under threat.

Lembit �pik: My hon. Friend illustrates the precise problem. This is not a theoretical debate about what might happen, but a practical debate about what is happening. When councils act in the way that she describes, and when individuals face the desolation of homelessness, we have to take ideas seriously. I ask the Exchequer Secretary to the Treasury to offer us a crumb of hope when she sums up, by saying that the Government will consider the points made by my hon. Friends the Members for Twickenham and for Falmouth and Camborne (Julia Goldsworthy), and by me. I hope that the Government will be willing to work on those ideas on a cross-party basis.
	It is implicitly acceptedI shall now say it explicitlythat the problem is not necessarily that loans were given in an inappropriate way in the past. The debt crisis arose because loans were given at a time when the economic circumstances were more stable and promising. Now that we find ourselves in a more precarious position, some loans that previously looked reliable look rather less reliable. The Government cannot be blamed for all the changes in economic circumstances, but they are responsible for responding now, at an early stage, when we can still prevent repossessionsthe number of which is relatively small, given the total number of householdersfrom becoming a big macro-economic problem due to the decelerator effect that a change in fortunes often heralds.
	About 7.5 trillion-worth of real estate is in the British public's possession, but the fact that debt is coming up to 1.4 trillion is a concern, due to the sheer size of the debt and the difficulty in managing it. The British people now pay 1 million of debt interest every nine minutes. That is one reason interest rates are so important, and have such a powerful effect on the general fortunes of our country. So what can we do about it? My hon. Friend the Member for Twickenhamor, as I like to call him, the next Chancellor of the Exchequerhas put forward a cohesive strategic package that we look forward to implementing, but the country cannot afford to wait two years for that. The Minister is perfectly welcome to plagiarise our ideas; what we are talking about is a strategic narrative, to use that word again, that brings us out of the danger of massive numbers of repossessions being made, with the knock-on effect that that would have on recession.
	The right hon. Member for North-West Hampshire (Sir George Young) made a very good point about house building and changing circumstances. We can consider other tools in addition to house building, such as shared ownership schemes, modular constructionthat can bring down the cost of high-quality housingrestoration and the release of about 1 million homes that are lying vacant for various reasons that include financial or planning restrictions. That would immediately increase supply and deal with fixed demand, which is hard to alter.
	So we have a basket of opportunities before us, which we can implement; not all of them cost a great deal of money, and some require only creativity, but it is important that we do that now, because we will not alter the demand for housing. We can alter the supply and therefore take some heat and pressure out of the system, reducing the risk of a crash as the market readjusts.
	I would say in parenthesisthis is not directly related to what we are discussing todaythat I hope that the Government revisit their home information pack policy. The HIP scheme does not seem to be delivering anything particularly useful to householders and, in the words of my hon. Friend the Member for Taunton (Mr. Browne), it is time for a HIP replacement. I hope we get that sometime soon. The evidence that we have seen from the Government's own surveys shows little faith in the HIP process among purchasers and, indeed, vendors of houses.

Julia Goldsworthy: Does my hon. Friend agree that the Government should be a little more open-minded on the success of some of their other schemes, which are aimed at helping first-time buyers into the market? We see from the figures that uptake of the first-time buyers initiative has been very low. Just last week, I received an e-mail from a constituent who has been trying to take part in the home-to-own programme for more than three years. It concludes:
	For a company and scheme that is supposed to be designed for young working couples or first time buyers, they are not giving us a chance. I also think 3 years to be on a waiting list is ridiculous. It's not as if we are waiting for council accommodation.
	Do not the Government need to accept the failings of their own schemes?

Lembit �pik: Individuals such as the one my hon. Friend quotes are not politicians; they are real people who are looking for real solutions. To that extent, I hope that the Government accept the circumstantial and anecdotal evidence, which adds up to clear mood music that this country is experiencing frustrations with some of the laudable proposals made by the Government. I understand that, so far, only 700 individuals have been assisted by the 100 million first-time buyers scheme, so while some of those schemes have potential, they are not realising it yet.
	I thank my hon. Friend the Member for Taunton for his HIP replacement joke, which I shall not use again, and conclude with these thoughts. Liberal Democrats, like members of any party, like to compete with the Government and spar for advantage. It is perfectly legitimate for us to make party political points. Indeed, I was quite impressed with the Minister when I saw that normally mild mannered and gentle lady turn into a ferocious tiger at the merest scent of a Liberal Democrat Focus deliverer. But this issue is too important for that. If we get it wrong, we all lose.
	Whatever the Minister says here in the Chamber, I hope that the Government are listening privately to the sage and considered advice from my hon. Friend the Member for Twickenham and others on the Liberal Democrat Benches who are more concerned with averting a housing catastrophe than they are with winning short-term points off the Government. The Minister, if she is listening, will accept that we raise those issues with good intentions and in good faith, and we hope that the dialogue can proceed in that way on a cross-party basis.
	Ignoring the warnings is the psychology of denial. The path thereof can spell disaster. Accepting the dangers rationally and working together to do something about them may yet avert a repossession catastrophe and prevent some social damage that goes beyond words but which it is in our power to prevent.

Jeremy Browne: I am grateful for the opportunity to speak at the conclusion of this important and timely debate. The context of our discussion is a Government who have lost a degree of control and ability to self-analyse with regard to economic policy and who are, as my hon. Friend the Member for Montgomeryshire (Lembit pik) has just said, in a state of denial. It was truly bizarre to hear the Financial Secretary to the Treasuryat a time of global credit crunch and when the country is on heightened economic alerttalking about the good old days when Derek Hatton ran Liverpool city council. Surely even Labour Members must regard that as a truly incredible reaction to the circumstances that we face.
	It is worth going through in turn the bald statistics on the current state of the British economy. Personal debt stands at 1.4 trillion. House prices are more than nine times average earnings, compared with five times at the start of the last housing crash back in 1990. As my hon. Friend the Member for Twickenham (Dr. Cable) said, house prices have fallen for five consecutive months. Real inflation for real people is far in excess of the official Government figure.
	It is also worth pausing to consider the tale of the two Opposition parties and two very different approaches to a state of national alert. One tale is that of the Conservative party, whose future policies are as embarrassing as its past failures. Furthermore, it is worth looking back to the grim statisticsthe record of the Conservative party in governmentin case we forget quite how catastrophic its stewardship was of the British economy.
	Between 1990 and 1997, 420,000 families had their homes repossessed. Between 1990 and 1995, house prices fell by 14.5 per cent., on average. Average interest rates when the Conservatives were last in office were around 11 per cent. and at one point reached 15 per cent. The average rate of inflation when the Conservatives were in power was 5.8 per cent. That is a truly embarrassing and appalling record and I am not surprised that they do not wish to dwell on it.
	What about the Conservative party today? Its position, as I understand it, was summarised by the leader of the party, the right hon. Member for Witney (Mr. Cameron), in his Budget response on 12 March, when he said that
	in the years of plenty, Labour Governments put nothing aside. They did not fix the roof when the sun was shining. . . in good years you put aside money for the bad years.[ Official Report, 12 March 2008; Vol. 473, c. 300-301.]
	That point was made by the hon. Member for Fareham (Mr. Hoban) but it is not what the Conservative party was saying during those so-called good years, seven or eight years ago.
	When he was the shadow Chancellor, Michael Portillo, speaking at a Conservative conference on 3 October 2000, argued for more funding and tax cuts. This is what he told the conference in the good years:
	We will cut taxes on business, so that they can compete and create prosperity and jobs. We will reform Labour's taxes on entrepreneurs and on inward investment. . .We will help pensioners and hard-working families. We will restore a married couple's allowance. We will cut the duty on fuel. That gives you a flavour of my budgets.
	That fiscal incontinence was not a one-off. At a repeat event, Michael Portillo as shadow Chancellor speaking at the next Conservative conference on 1 March 2001again, in the good years that we hear so much about from the Conservative Front-Bench teamsaid:
	Analysts believe the Chancellor has about 5 billion more than he thought. It is perfectly possible to cut the fuel tax this year without any impact on government spending or public services. Everyone knows that Gordon Brown has a war chest.
	In other words, he wanted lower taxes and higher spending.
	The truth is that the Conservatives now have just two economic policies. The first policy is to criticise the Labour party for taxing and spending too much. The second policy is to tax and spend exactly the same as the Labour party is suggesting. The Conservative shadow Chancellor told BBC Breakfast news on 3 September 2007:
	The Conservatives will spend the same as Labourif there is a Conservative government there will be real increases in spending.
	I urge the House not to believe too readily the Conservative analysis and their changing tale about the economic circumstances in this country.
	The Conservative shadow Chancellor started his time in office back in 2005 by making a trip to Estonia to see how he could introduce a flat-rate tax in Britain. He is now instructing his shadow Chief Secretary not to bring forward any proposals for Conservative tax cuts until 2015. It is no wonder that on 15 February the online version of  The Spectator, a journal generally sympathetic to the Conservative party, commented:
	The Conservative leadership attacks Gordon Brown for being a ditherer and ordering endless reviews to put off making decisions. But the Tories are not averse to such delaying tactics themselves. The Conservatives' policy on taxation in recent years feels like one colossal dither.
	I agree with that assessment. The shadow Chancellor and the Conservative party have no policies on the credit crunch, Northern Rock or tax.
	The other Opposition party, the Liberal Democrats, by contrast, have led the debate. My hon. Friend the Member for Twickenham is too modest to say so himself, so I will quote on his behalf what he told the House on 13 November 2003almost five years ago, before I was elected. It is worth Members listening to this. My hon. Friend said:
	On the housing market, is not the brutal truth that with investment, exports and manufacturing output stagnating or falling, the growth of the British economy is sustained by consumer spending pinned against record levels of personal debt, which is secured, if at all, against house prices that the Bank of England describes as well above equilibrium level?
	It is amazing that someone could have made that speech in the House five years ago and that the Government paid so little heed to it. In response to my hon. Friend, the then Chancellor, now Prime Minister, said:
	The hon. Gentleman has been writing articles in the newspapers, as reflected in his contribution, that spread alarm, without substance, about the state of the British economy.[ Official Report, 13 November 2003; Vol. 413, c. 398.]
	No wonder the Prime Minister has acquired a reputation for complacency and dithering.
	In an interview in  The Independent on Monday this week, the right hon. Member for Norwich, South (Mr. Clarke), the former Home Secretary, was asked:
	What has been Gordon Brown's biggest mistake since taking over as Prime Minister?
	The right hon. Gentleman's answer was:
	Allowing a sense of indecision to develop.
	For understatement, that almost matches the first line of the recent annual report from our most high-profile financial institution:
	2007 was a difficult and challenging year for Northern Rock.
	Members who are in government at the moment are equally critical. The Under-Secretary of State for Health, the hon. Member for Bury, South (Mr. Lewis), quoted in  Progress, described the attitude of the British public. He said:
	at a time of growing insecurity their anger
	that is, the British public's anger
	is ignited when they feel the government is losing touch with what fairness means to the mainstream majority who work hard, play by the rules and are feeling squeezed by rising utility bills, the cost of petrol and rising council tax.
	According to  The Mail on Sunday, the solution to that problem has been identified at No. 10: the Prime Minister is to try a new speechwriter. The newspaper ran an article in which an insider at No. 10 is quoted at length, saying that the Prime Minister's
	 'cluttered' way of delivering the Government's messages, the lack of 'personality' in his speeches and the 'stilted language that he tends to use' 
	were among the problems stopping the Government getting over their apparently entirely positive record. The helpful, loyal source went on to say that what was needed were a few good jokes. We have been listening to Labour Members this afternoon and when it comes to a few good jokes, they were pretty goodalthough not in the way they meant to be.
	Indeed, the Financial Secretary came up with this solution to the current problems in the housing market: better primary school education so that people can do their sums. As the average first-time buyer buys a house in their mid-30s, that sounds an excellent way of starting to address housing problems 30 years from now. However, it may not be an immediate solution.
	The hon. Member for Newcastle upon Tyne, Central (Jim Cousins) appeared to blame all the country's economic woes on the speeches of my hon. Friend the Member for Twickenham. If it is that simple to stop the Government's economic problems, I am sure that, as an act of charity, my hon. Friend will make fewer speeches.

Julia Goldsworthy: My hon. Friend has been speaking, ironically, about the success of the child trust fund

Mark Hoban: No he hasn't.

Julia Goldsworthy: He talked about the long-term potential of the child trust fund.

David Gauke: No he didn't.

Julia Goldsworthy: He did mention it. Although I can imagine the Secretary of State for Children, Schools and Families in his school playground aged seven discussing the rise and fall of the value of his trust fund, does my hon. Friend agree that the funds are not likely to have such an effect on the vast majority of primary school children?

Jeremy Browne: I agree with that excellent intervention. I regret that Members of the Labour and Conservative parties do not recognise its importance. The salient point is surely this: it is woeful for a Minister to say that the Government are putting in place measures to deal with today's housing problem and, when asked what they are, to reply, We have a programme for better education in primary schools so that the children can add up better when they take out a mortgage in future. Can the Government do no better than that? It is no wonder the Blairite spin doctor Phil Collins, whom No. 10 begged to rescue its drifting ship of state, is reported to have said:
	Brown doesn't need a speechwriter. He needs a magician.
	The Prime Minister certainly needs the hard-headed, practical policies that address the current malaise and were outlined and proposed by my hon. Friend the Member for Twickenham at the start of this debate. I will dwell on three key points that he made.
	First, we must stop mass repossessions and fire sales of property. Before repossessions, banks must have offered free financial advice and explored all other alternatives, such as renegotiating the terms of the loan and offering shared-equity schemes. Secondly, we must change the Monetary Policy Committee's mandate so that house prices are taken into account when setting interest rates, which would be more flexible and responsive and enable the Bank to damp down housing booms. Thirdly, we must have better regulation. We need to come to terms with the fact that the Financial Services Authority has been found wanting and that banking regulation should include active, counter-cyclical management of bank reserves to prevent future cycles of excessive lending and contraction. Those are positive and responsible suggestions.
	Instead, we have a Government with their head in the sand. The disaster at Heathrow airport provides a perfect metaphor for this Administrationhuge budgets, inflated expectations, management incompetence, communications ineptitude, public anger and a state of total denial. This is a terminal 5 Government who are in terminal decline.

Angela Eagle: The Liberal Democrat motion has been much commented on, possibly because it reads like the storyboard for Apocalypse Now, or perhaps even Bleak House. According to the motion, we are facing an
	extreme bubble in the housing market
	and the risk of recession, and we must
	act to prevent mass home repossessions.
	Presumably that is why the hon. Member for Taunton (Mr. Browne) got through his entire speech without mentioning any of those things until the last minutethey obviously keep him up late at night.
	Fortunately for all of us, however, that colourful and lurid fiction has no real bearing on the macro-economic reality. In difficult economic timeshere I find myself in agreement with the hon. Member for Fareham (Mr. Hoban) [ Interruption. ] at least in part; I do not want to get him into trouble. In difficult economic times, it generally pays to remain calm and to apply a cool, analytical mind to the situation. Hysterical over-reaction, as this motion demonstrates, might attract a few cheap headlines and some doom-laden Lib Dem press releases, and it might even frighten a few voters ahead of local elections, but it is not mature or responsible, as my hon. Friend the Member for Leeds, East (Mr. Mudie) took some time to point out.
	Now that we have had Apocalypse Now and Bleak House, I am going to talk about An Inconvenient Truth, which is that the economy is strong and stable. That underpins our whole response to the Liberal Democrat motion.

Lembit �pik: If the Minister is telling us that the economy is in good shape, what message does she have for the people of Powys and Monmouthshire, whose average income fell by 4 per cent. in absolute terms between 2006 and 2007? Is that not a clear indication that the concerns raised by my hon. Friend the Member for Twickenham (Dr. Cable), myself and others are not theoretical but practical, as they are affecting my constituents now?

Angela Eagle: We are not complacent about the situation that we face, but we do nobody any good by being hysterical about it and talking down the prospects. When there are difficult times, economic or otherwise, it pays to remain calm, cool and analytical; it does not pay to scaremonger and run around talking about housing bubbles and, in the hon. Gentleman's phrase, repossession catastrophes. I would caution him on his use of language.
	Lib Dem Members tried to suggest that Britain's economy is in a similar position to the early 1990s, but that simply is not the case. The truth is that the macro-economic position is much healthier than it was in the early 1990s. Britain's economy is strong and stable. We have had over 15 years of growth, according to Treasury and independent forecasts and, as my right hon. Friend the Financial Secretary pointed out, Britain is forecast to be the joint fastest growing economy in the G7 this year having achieved the fastest growth in the G7 economies last year. We have seen the highest rise in income per head of any G7 economy since 1997. That does not mean that we are complacent about the issues that face us, or about the financial turbulence happening around us at the moment. We are, however, in a better position to get through the turbulence that we see ahead than many other economies.
	Inflation in the UK is lower than it is in the euro area or in the United States, interest rates remain relatively low, and there are more people in work than ever before. That is an important aspect of our resilience; we have to ensure that we do our best to keep the economy growing, albeit at a slower rate, during the current situation, so that we can bounce back to better levels of growth faster. Instead of being the first in and last out of any recession, which always used to be the UK's fate, the changes that we have made to the way in which the economy is run have demonstrated that we can be more resilient and recover quickly.
	In the early 1990s, unemployment topped 10 per cent. Liberal Democrat Members are attempting to persuade us in their motion, and in some of their contributions, that we have somehow returned to that period. In fact, the hon. Member for Twickenham (Dr. Cable) said that we are in a worse position now than we were in the 1990s. Potentially, we are always in a worse position, just as, potentially, we are always in a better position. Tomorrow may come, and it probably will. We can forecast that that might happen. In the early 1990s, unemployment topped 10 per cent., inflation hit nearly 11 per cent. and interest rates rose to nearly 15 per cent. In comparison, unemployment is now at 5.2 per cent., inflation is at 2.5 per cent. and interest rates are at 5.2 per cent.

Si�n Simon: For the benefit of those of us who struggle with sums and things, I wonder whether the Exchequer Secretary would be kind enough to couch what she is saying in the language of the motion that we have been subjected to by the hyperbolic Liberalsperhaps she could do so in terms of bubble size. It is alarming me to discover that people as esteemed as the Liberals think that we are in the grip of an extreme bubble. If we are in an extreme bubble now, could she tell us what sort of bubble we were in during the early 1990s when people's homes really were being repossessed by the hundreds of thousands?

Angela Eagle: With respect to bubbles, I am not sure whether size matters or not. How large is the bubble? How long is a piece of string? It is difficult to know. The important part of coming out of a housing bubble, or the unwinding of any economic situation, is whether it is done chaotically or with stability. Because our economic fundamentals are right, we can look forward with reasonable expectation to getting out of this situation. The housing situation will be unwound in a relatively calm and orderly way, which is what people need to know.
	If chaotic unwinding happens, we will be in a 1990s-style situation. If we had mass unemployment, the situation would be a lot more fragile than it is now. It does not do the Liberal Democrats any good to hope that tabling a hysterical motion, upsetting people and scaremongering will help them in the local elections. That is not mature or responsible, as my hon. Friend the Member for Leeds, East pointed out. Britain is in a far better position today than it was in the 1990s.

Christopher Huhne: Will the Exchequer Secretary give way?

Angela Eagle: I am happy to give way to the hon. Gentleman. I would have been even happier to do so if he had had the courtesy to stay for the whole debate.

Christopher Huhne: Given that circumstance, I am especially delighted that the Exchequer Secretary is giving way. Can she name previous occasions on which the house price to earnings ratio has been as high as it is todaythere have been four in the past 30 yearswhen the position has unwound in a stable and orderly manner?

Angela Eagle: The answer is to ensure that supply matches demand more carefully. There have been increases in house formation and a need, as the Government announced and for which they provided finance, to build more houses. That will assist the ratio.
	I do not accept the Liberal Democrats' comparison of today's economy with the 1990s. They can talk our economy down as much as they likethey have been at it todaybut it is forecast to grow this year, next year and in future. That is an inconvenient truth, but we should put it on the record.
	The second main charge is that personal debt is too high. It is true that it has risen, but so have total household assets, against which the debt is secured. They stand at 7.5 trillion. Household balances remain strong and net household wealth has increased by 72 per cent. in real terms since 1997.
	Of course, consumers need to be able to make the right financial decisions when they take out debt, be it in mortgages or in other forms. The Government are helping with that through our work on financial capability. With the Financial Services Authority, we have agreed to provide 12 million to run a pathfinder project in the next two years, following Otto Thoresen's recommendations on financial capability. That will test the best ways in which to ensure that everyone in the country can get free, impartial and high-quality advice on their money when they need it. Advice is also available for people who get into difficulty, and our financial inclusion fund is helping to ensure that that is available to those who need it.
	Let me deal with the Liberal Democrats' third point on the housing market and repossessions. It is hard to take Liberal Democrat forecasts on the housing market seriously since they have been predicting a crash for most of the past 10 years. Regardless of the objective conditions in the economy, they trade on gloom and fear and predict a collapse. They were at it again today. I suppose they think that, if they keep saying it for long enough, one of these days it might turn out to be true, a little like the stopped clock, which tends to be right twice a day.
	What do the facts tell us? The Liberal Democrats drew comparisons with the 1990s, but they are easily dismissed. House price inflation is declining relatively gradually and house prices are still higher than they were a year ago. Our expectation, as set out in the Budget, is for sluggish or flat house price growth this year. The Liberal Democrats do no one favours by scaremongering about 25 per cent. falls.
	There were high numbers of repossessions in the early 1990s, but the picture is different today. Last year, despite 2 million extra mortgages and 1.8 million more home owners, there were less than half as many repossessions as in 1991 or 1992. The Liberal Democrats were at it again on the Treasury Committee, when they questioned Bank of England chief economist, Charlie Bean, about the so-called housing crash. He told the Committee last Wednesday that repossessions are still at low levels and that special measures were simply not called for at this juncture. The Government would be ready to consider special measures if, objectively, they were required. Currently, they are not.
	The hon. Member for Taunton said that the Conservative party did not have any policies. He was being a bit cruel; they have a couple of policies and I want to spend a little time on mortgage regulation. The Conservatives issued a document not long ago called, Freeing Britain to Compete: Equipping the UK for Globalisation. The right hon. Member for Wokingham (Mr. Redwood) was in charge of the document, which I shall quote. He said:
	We see no need to continue to regulate the provision of mortgage finance, as it is the lending institutions rather than the client taking the risk.
	Tory party policy only a couple of months ago was to deregulate mortgage finance provision to prepare us for globalisation. I cannot think of a more ridiculous, pathetic and dangerous policy than the one that the Conservatives developed and were trumpeting, until the beginning of the credit crunch taught them that perhaps regulation of mortgages is a good thing.
	Britain's economy is in a far stronger position than it was. Personal debt is far lower than the amount of household assets and support is in place for those who get into difficulty. The signs are that house price inflation is declining relatively gradually and the number of repossessions is small. That does not mean that we are complacent. We will be keeping a close eye on how things go and will stand ready to act if the situation should deteriorate.

Question put, That the original words stand part of the Question:
	 The House divided: Ayes 71, Noes 299.

Question accordingly negatived.
	 Question, That the proposed words be there added, put forthwith, pursuant to Standing Order No. 31 (Questions on amendments):
	 The House divided: Ayes 291, Noes 209.

Question accordingly agreed to.
	Mr Speaker  forthwith declared the main Question, as amended, to be agreed to.
	 Resolved,
	That this House acknowledges the resilience of the United Kingdom economy, which grew faster than any other major economy in 2007 and in which employment is at record levels; notes that the record of economic stability since 1997 has laid the foundation for rising home ownership, with the number of owner-occupier households rising by 1.8 million since 1997; further notes that household finances remain strong, with household assets worth over 7.5 trillion, more than five times the level of personal debt; believes that the United Kingdom is well placed to respond to the challenges arising from the continuing international financial turbulence; applauds the Government for managing the public finances within its fiscal rules; recognises that the Bank of England Monetary Policy Committee has cut interest rates twice in recent months; further acknowledges that mortgage interest rates are currently around half the level of those reached in the early 1990s and that the proportion of repossessions is less than one third of the rate in the peak year of 1991; welcomes the Council of Mortgage Lenders' recent statement, which sets out the steps that the industry is taking to support borrowers facing repossession, including working with debt advisers, pro-actively identifying at-risk borrowers and only repossessing as a last resort; and supports the Government's initiatives to assist home ownership, including new measures to encourage long term fixed rate borrowing and new forms of shared equity.

Heathrow

Mr. Deputy Speaker: I must advise the House that Mr. Speaker has selected the amendment standing in the name of the Prime Minister, and that there is an eight-minute limit on Back-Bench speeches in this debate.

Norman Baker: I beg to move,
	That this House recognises the urgent need to curb carbon dioxide emissions to tackle climate change; condemns the Government for following policies that will instead lead to significant growth in emissions from the aviation sector; particularly condemns plans to allow a third runway at Heathrow; believes that the consultation paper Adding Capacity at Heathrow Airport was deeply flawed and is concerned at the undue influence BAA played in the drafting of the paper; notes that the paper significantly overstated the economic case for a third runway while greatly underplaying the serious environmental consequences, including, as well as the extra emissions from flights, the increase in intensity and distribution of noise for those living under the flight path through runway alternation and the threat of forced relocation for the inhabitants of Sipson village; and calls on the Government to withdraw permanently plans for a third runway at Heathrow, to keep the present cap of 480,000 flights per year as opposed to the 700,000 envisaged in the consultation document, to rule out any further increase in airport capacity in the South East, and to indicate to the aviation sector that it will have to live within its existing infrastructure capacity.
	We are starting the debate marginally later than I thought we would. I can conclude only that the Conservatives have some reason for delaying its startperhaps they do not want to talk about their chaotic policy on Heathrow and aviation. I note that an eight-minute limit on speeches applies, so it was rather unfair to take 15 minutes away with an unnecessary Division.
	The Government's policy on aviation is described in their amendment to the motion as a
	balanced and sustainable aviation strategy.
	I wonder whether the person who wrote that had any shameI do not know whether it was written by a Minister, a Whip or an official in the Department for Transport whether the Government are past that stage or, indeed, whether, as with much of the consultation paper, it was in fact written by someone from BAA plc, with glee rather than with shame.
	As far as aviation is concerned, it seems that the Government live in a sort of bubble, in which climate change does not exist. The rest of Government policy is designed to drive down carbon emissions, making a 60 or 80 per cent. cut by 2050, but aviation somehow does not come into that picture and has to live on its own. I am interested in the comments made by the hon. Member for Sunderland, South (Mr. Mullin), a former Environment Minister. He said:
	During my 18 undistinguished months as a minister
	I think he was being ungenerous
	whose responsibilities included aviation, I learned two things. First, that the demands of the aviation industry are insatiable. Second, that successive Governments have usually given way to them. Although nowadays the industry pays lip service to the notion of sustainability, its demands are essentially unchanged. It wants more of everythingairports, runways, terminals.
	That is still the case.

Alan Keen: I might have been tempted, because of my constituency interest, to vote for the Liberal Democrat motion. Unfortunately, it seems to have got mixed up. Lines nine and 10 refer to
	the increase in intensity and distribution of noise...through runway alternation.
	In fact the increase in intensity and distribution of noise for my constituents and those who live in the neighbouring constituencies to the east would be caused by the end of that runway alternation. I am afraid I shall have to vote against the motion.

Norman Baker: Noise will increase because of the ending of runway alternation; that is quite true.

Justine Greening: The Lib Dem motion calls for the end of the thing that my constituents value most, which is the half-day respite from aircraft noise that results from runway alternation, which the motion says is a bad thing. Furthermore, the motion does not call on the Government to rule out that problem, although it calls on them to rule out a third runway. That leaves the door open for flights over my constituency all day, every day.

Norman Baker: That is not the intention of the motion, as the hon. Lady knows very well.

David Wilshire: Will the hon. Gentleman give way?

Norman Baker: I have already given way twice; I must make some progress.  [ Interruption. ] All right, go on.

David Wilshire: The hon. Gentleman has admitted that one bit of his motion is a load of rubbish. Will he tell us which other bits are a load of rubbish?

Norman Baker: I knew I should not have given way. That intervention is not worth responding to, I am sorry to say.
	I quoted the hon. Member for Sunderland, South. It is worth mentioning that in 1995 BAA put in an application for a fifth terminal, as we know, which opened with all the chaos that we saw last week. At the time, it promised that that would not lead to a third runway. Permission was given on that basis. Whenever the aviation industry says, This is all we want, it always goes further. It always comes back for more. It is never the final line.
	BAA is like some kind of fiendish drug addict and the Government are its willing dealer, and they do not even charge a decent price or the market rate. I shall come on to the consultation document in a moment, but there are serious questions about the Government's independence in relation to the aviation industry and whether it is subject to regulatory capture.

Claire Curtis-Thomas: I am rather alarmed by some of the descriptions of BAA. Does the hon. Gentleman acknowledge that BAA's expansion plans for Heathrow are a direct result of its being the largest international airport in the world and the unprecedented demand, which produces a significant number of jobs in the UK and provides us with a robust industry that we want to support?

Norman Baker: I do not agree with all that. For a start, I do not agree that that is a cause. BAA has continually asked for expansion, and the Government have followed the predict-and-provide policy. Of course, if space is provided it fills up. The Government recognise that with roads. They abandoned the idea of predict-and-provide for roads but not for aviation. However, I shall come on to the economic case later.

John Redwood: Will the hon. Gentleman give way?

Norman Baker: I must make some progress. I have taken, I think, six[Hon. Members: Come on!] All right.

John Redwood: I am very grateful to the hon. Gentleman for giving way, because this is a debate. Why does the Liberal party believe that if we restrict capacity at Heathrow that will reduce aviation? Those on the continent would be massively grateful. Charles de Gaulle, Schiphol and all the rest would expand their capacity and we might end up with more emissions rather than fewer. Surely the solution to the emissions problem is to press for a new generation of more fuel-efficient and quieter aircraft, which are what we need, rather than trying to hamstring our industry at home.

Norman Baker: I note the unholy alliance between the right hon. Gentleman and Government Front Benchers, who agree on that point. That is part of the problem. Of course we want improvements in aircraft design and want to limit emissions per aircraft if we can do so. However, providing extra capacity generates more flights. That is the point the right hon. Gentleman refuses to accept. The flights generated will partly be short-haul flights, the need for which could be met by long-distance, high-speed rail. The right hon. Gentleman, who does not like railways, refuses to acknowledge that point.
	The right hon. Gentleman also refuses to acknowledge the serious impact of climate change, which nobody has so far mentioned. The impact of aviation on climate change is quite clear. It contributes about 6 per cent. of the UK's carbon emissions, compared with 24 per cent. from road traffic, but since 1990 the proportion of carbon emissions from aviation has more than doubled. Emissions from air travel are due to rise by 83 per cent. from 2002 levels by 2020, and could amount to a quarter of the UK's total contribution to climate change by 2038. How does that significant increase in carbon emissions from aviation square with the Government's stated policy of securing a 60 per cent. cut in carbon emissions by 2050? Why is aviation exempt from that target?

Justine Greening: I am slightly perplexed, because the Liberal Democrat motion mentions ruling out any further expansion in the south-east. It therefore seems to suggest that a plane taking off from Manchester somehow emits less CO2 than one taking off from Gatwick. Is that what the hon. Gentleman is saying, or is it another mistake in the motion?

Norman Baker: The reality is that the motion does not mention flights from Senegal, but that does not mean that we are not interested in flights from Senegal. That was a ridiculous intervention by the hon. Lady.
	I shall move on to other aspects of the environmental impact of the proposed third runway.

David Wilshire: Will the hon. Gentleman give way?

Norman Baker: I will not, because I have given way on eight or nine occasions and I am six minutes into the debate.
	Let us consider the other impacts of the third runway, apart from the impact on climate change. The Government admit that air pollution at Heathrow will exceed the EU legal limits if a third runway is built. They have had to get BAA to try to massage the figures to find a way of getting round that problem.
	There are particular issues in relation to road transport. The Department for Transport estimated in a parliamentary answer I received the other day that a third runway at Heathrow would create an extra 1.2 million journeys on the underground, 2.3 million journeys on heavy rail and 10.2 million journeys by car and taxi. The assumptions made in the Adding capacity at Heathrow documenta loaded title if ever I heard oneare simply not credible. It estimates that the public transport annual mode share will increase from 36.2 per cent. in 2004 to 41.7 per cent. in 2030, more than doubling the number of passengers. Where will that capacity on public transport come from? There are no plans to provide it in the Government's expansion plans.

Ruth Kelly: What about Crossrail?

Norman Baker: Crossrail is very welcome, but it will not provide sufficient capacity to enable more than double the current number of passengers to be transported to Heathrow airport. That increase is in addition to the anticipated growth in demand for London underground services, which is estimated to be 50 per cent. by 2020.
	The consultation document also states that a third runway would require the provision of rail services to manage 1,600 passengers an hourtwo thirds of the current capacity available on the Heathrow Express and Heathrow Connect services. Those calculations are based on actual passenger numbers and do not include a consideration of the additional journeys to be made by people accompanying friends and family to the airport. It is perfectly plain that the Government are making no plans to take properly into account the extra journeys that will be made to the airport, whether by road, underground or heavy rail. There are no plans for investment to meet the predictions of the journeys that will be generated.

David Wilshire: The hon. Gentleman has got some facts wrong, and clearly some of his research has not gone very far, either. Has he not come across the proposal to build a brand new railway, AirTrack, through my constituency, which will go a long way towards solving the problems he is talking about?

Norman Baker: I maintain my point that the more than doubling of the number of people expected to travel by public transport cannot be accommodated by one project.

Susan Kramer: Will my hon. Friend confirm that the Government have not committed the funding that would enable AirTrack to be built in such a way that it did not completely close off most suburban commuter services through south-west London, including by bringing down level crossings for 45 minutes of every hour at peak time?

Norman Baker: That point is very relevant, and of course the Conservative party has not committed itself to that project, even if it did have the beneficial effects to which the hon. Member for Spelthorne (Mr. Wilshire) referred.
	There is also a problem with air pollution. The 2003 aviation White Paper stated that air quality levels must remain consistently within EU limits coming into effect in 2010. Of course, that would represent an improvement in air quality in residential areas compared with what obtains today.
	How is it possible for that target to be met, if the Government are anticipating yet another expansion of Heathrow? It seems to me incredible that the Government can imagine that more flights, runways and terminals will lead to less pollution, lower emissions and fewer environmental problems. However, that almost seems to be what the Government's consultation document claims.
	Another problem is the impact on the local area. If plans for a third runway were to go ahead, BAA has estimated that at least 700 homes in the area would have to be demolished, affecting some 1,600 people. In addition, the village of Sipson would disappear off the map by 2020, and many ancient buildings would be destroyed. Residents at Harlington and Harmondsworth would be evicted, and thousands more would be seriously hit by the increase in noise and air pollution. Other villages such as Cranford and Longford would also be affected.

Nick Palmer: I have some sympathy with some of the hon. Gentleman's points about the aviation industry, but is he aware that the union Unite has said that a cap on the number of flights such as the one proposed in the motion would cause as many as 20,000 jobs to be lost in the local area?

Norman Baker: No, I do not accept that.

Andrew MacKinlay: I should like to say something about Unite, of which I am a member. Employers always find the unions that they need when it suits them, and unions always foolishly swallow it. It was always claimed that there would be social and political armageddon in south-west London when duty-free finished, but that was nonsense. By the same token, it is utter rubbish to suggest that there will be employment implications if the Heathrow expansion does not go ahead. Moreover, accepting that proposition on employment for terminal 5 means accepting it for terminals 6, 7, 8 and so on forever. I love the Unite union very much, but that suggestion is complete rubbish.

Norman Baker: I am grateful for that intervention, and for the hon. Gentleman sharing his knowledge on the matter.
	I deal now with noise pollution in particular. There is no doubt that the expansion of Heathrow will result in extra noise pollution for local residents. The key figure quoted by the Government is 57 dB, as that is the level at which community annoyance sets in. BAA has estimated that more than 250,000 people now live inside the 57 dB contour. They are therefore affected already, but the proposed expansion will make the problem much worse.
	In fact, the problem is even more serious, as the World Health Organisation has challenged the Government's view on noise thresholds. It has argued that 50 dB is the appropriate level for determining annoyance, and that 55 dB constitutes serious annoyance. Therefore, even according to the BAA figures, it is clear that all the people in the immediate area are experiencing serious annoyance, according to the WHO definition.
	In November 2007 the Government published a study entitled Attitudes to Noise from Aviation Sources in England, and Ministers will know that it reinforces the WHO's argument very strongly. Although there are only 250,000 residents in Heathrow's 57 dB area, another 2 million people live within the 50 dB area. Adding those figures together gives us the total number of people the WHO believes are being affected by noise pollution at the present time, so what will the total be if the planned expansion goes ahead?
	The Government said that they would not go ahead with Heathrow expansion if the number of people living in the 57 dB area increased. How will the Government square having a third runway with that pledge on noise? We have heard nothing about that.
	In addition, the new flight path will pass over such places as Heston, Chiswick, north Hammersmith, Kensington and Chelsea, Langley, Slough and Maidenhead. A total of 150,000 people live in those areas, but do the Government believe that they do not count?
	On top of all that, Heathrow expansion would have significant impacts on health. The 1999 study into public health impacts at large airports that was carried out for the Dutch Government found evidence to suggest that exposure to the air pollution levels observed within an airport's operations systemand in that sense Heathrow is the largest airport in the worldwas linked to higher mortality rates, and to more frequent hospital admissions as a result of the aggravation of respiratory and cardiovascular problems. The study also found that air pollution was linked to decreased lung function, and an increase in chronic respiratory conditions. What assessment have the Government made of the current health implications for people who live near Heathrow, and what assessment have they made, seriously, of the implications if a third runway is given the go-ahead?

David Wilshire: Will the hon. Gentleman give way?

Norman Baker: I have given way to the hon. Gentleman twice, and the last time it was not worth doing so, so he will forgive me if I do not give way now.

David Wilshire: I was going to be helpful to the hon. Gentleman.

Norman Baker: The hon. Gentleman said that he would be helpful last time. On the issue of children and education, I refer the Secretary of State to the European Commission's RANCH project on road traffic and aircraft noise exposure, which found a clear link between aircraft noise and delays in reading age. A 5 dB increase in noise level was linked to children being up to two months behind in their reading age. Those are serious issues for people who live in the Heathrow area, and they are not being addressed; they are being skated over. The Government are not taking into account health or the environment; they are considering only BAA.
	A third runway would increase flights at Heathrow from 477,000we were promised that that would be the maximumto 720,000 a year. That is a huge increase, and it is contrary to a statement made in 2001 by one of the Secretary of State's predecessors, the right hon. Member for North Tyneside (Mr. Byers), who said of terminal 5:
	we are making it a planning condition that there will be a limit of 480,000 flight movements a year.[ Official Report, 20 November 2001; Vol. 375, c. 183.]
	That pledge was made firmly by her predecessor less than seven years ago, but it is being torn up, and the Government apparently anticipate a virtual doubling of flights into Heathrow.

Susan Kramer: I thank my hon. Friend for making that point, because it touches on the sense of betrayal that my constituents feel. Not only did the Government agree that they would cap flights at 480,000, but Sir John Egan, chairman of BAA, said that BAA would urge the Government to rule out an additional runway at Heathrow if permission were given for terminal 5. On the basis of that trust, approval for terminal 5 was given, only for that agreement to be torn up three weeks after the planning inspector's decision.

Norman Baker: My hon. Friend is absolutely right, and we can draw three lessons from that. The first is that the aviation industry is insatiable, as the hon. Member for Sunderland, South has said; the second is that Governments always give way; and the third is that when it comes to aviation, they do not keep their promises. In fact, they forget their promises and pretend that they have not made them. Another issuethe number of issues to do with Heathrow is almost endlessis the question of whether expansion is safe. That is an important and serious consideration.

John Horam: The hon. Gentleman makes an important point that he has not mentioned in his motion, although it is very much on my mind following the tragic air crash in Farnborough in my constituency on Sunday, in which five people died in a plane. It is a miracle that more people were not killed in the residential area that abuts Biggin Hill. When planning airport expansion, the Secretary of State ought to pay attention to the question of how close expansion should come to built-up residential areas with hospitals, schools and houses. It is a serious issue.

Norman Baker: I thank the hon. Gentleman for that intervention; he makes an important point. Of course, because we are expanding Heathrow incrementally and constantly, the expansion will come up against existing settlements; some will be demolished, but others will be left very close indeed to runways. That is worrying and needs to be considered.
	Another safety issue is the question of how much traffic we can accommodate in the skies around Heathrow and over London. Will we have a system of stacking, which is environmentally unsustainable and churns out huge amounts of carbon emissions for no benefit? It is also suggested that stacking will result in a greater number of planes attempting to land at Heathrow than air traffic control can deal with. At the last Transport Question Time I put that point to the Under-Secretary of State for Transport, the hon. Member for Poplar and Canning Town (Jim Fitzpatrick), who is responsible for aviation, and who is present today. I quoted to him a report in  The Sunday Times that said that NATS and the CAA were of the view that there was insufficient airspace to accommodate the scale of predicted traffic growth, according to current predictive technology. In his response, the Minister said:
	The CAA has examined our White Paper proposals and believes that the necessary airspace capacity can be provided safely.[ Official Report, 4 March 2008; Vol. 472, c. 20.]
	I wrote to NATS, because I am a suspicious sort of person, and I got a letter back from it only yesterday. It is from the corporate and technical centre, so I suppose that the writers of the letter know what they are about. It says:
	NATS has not yet carried out detailed work as there has been no requirement for us to do so. We are not therefore able to advise at this stage on any specific airspace changes that may be required in support of any change in Government policy to permit expansion at Heathrow.
	NATS has not carried out detailed work, and it has not been asked to carry out detailed work. How does that square with the assurance that the Minister gave me in Transport questions? More to the point, why has it not been asked to carry out that work? I should have thought that that was one of the first things that the Government ought to do.
	Let us move on to the economic case. If there are all those environmental downsides to Heathrow, which there undoubtedly are; if there are concerns about health, which there are; and if there are concerns about safety, which there are, what are the overriding benefits that suggest that we should go ahead with the proposal? The Government keep saying that it is terribly important for Britain's economy, so it seems that in the equation they have set out for themselves we have the economic benefits on one side and virtually everything else on the other. Are those economic benefits so strong and so enormous that they outweigh all the disbenefits that I and many others have identified in the last weeks and months?
	A couple of days ago, the Aviation Minister dealt with the urgent question on terminal 5 and told the House that
	the expansion of Heathrow is of fundamental importance to the economy of the United Kingdom. We believe that we have demonstrated that. It must take place and we have demonstrated how it can take place with the environmental protections that we have laid down...We are confident that, when we analyse the consultation...and publish our findings in the summer, our validation will be proved to be correct.[ Official Report, 31 March 2008; Vol. 474, c. 434.]
	That does not suggest that there is much of a consultation exercise going on, as the Government have already concluded that they will be proved right.

Angus MacNeil: Does the hon. Gentleman agree that, whether we like it or not, the situation with Heathrow is as it is, that it is important to protect the landing slots from Scotland and, in particular, that there should be an expansion of landing slots from Inverness? We should have direct access to Heathrow from the highlands of Scotland, which is a large area. I hope he supports that.

Norman Baker: I understand the position of those remote communities in particular, which have a stronger case for aviation links to London than do, dare I say it, those who are rather nearer to London but still arguing for expansion.
	We have heard the arguments about Heathrow being important to the national economy, but how important is it? On the question of who uses Heathrowthis comes from another parliamentary answer that I received26 per cent. of those passengers are international-to-international transit passengers. Apart from the benefits to BAA's airport shops, I am not clear about exactly what benefit is brought to the UK by 26 per cent. of passengers transferring from international airline to international airline. I say to the Minister that if all those people went to Schiphol, I do not see what the impact on the British economy would be.
	There is a further contingent of passengers, which is those who transfer from domestic to internationala substantial number of people. Those passengers, of course, could be better served if there were perhaps more flights from places such as Manchester out to international destinations, rather than flights always going from Heathrow. But it suits BA to use Heathrow as a hub, moving planes into Heathrow and passengers

David Wilshire: Will the hon. Gentleman give way?

Norman Baker: I am not giving way to the hon. Gentleman again in this debate. I am sorry, but I have already given way to him two or three times.
	It very much suits BA and BAA to move passengers into Heathrow and then move them out again, because it means that those people can stay at Heathrow and use BAA's shops, spending lots of money. It does not much suit passengers, who would benefit from more direct flights. Nor does it suit the environment to have two flights instead of one. Does the Government's consultation paper consider whether there is a prospect of moving flights from Heathrow to other UK airports, which would obviate the need for a third runway?

Angus MacNeil: Unfortunately, I am a frequent traveller to Heathrow and, unfortunately, I had the largest travel expenses of any Member of this Parliament last year, given geography and the many flights that I have to take each week. I am often struck by the fact that, after coming down from Glasgow at high speed, flights end up stacking at Heathrow. Is there any way to slow flights down so that the need for stacking would be reduced and people could arrive in some sort of sequence, rather than spending their time stacked up over London, which, believe me, is very frustrating for passengers?

Norman Baker: The hon. Gentleman makes a good point and what he refers to is a fault of the current system. We could eliminate some carbon emissions if we had better planning of flight arrivals. Trains do not all arrive at Victoria at the same time and have to wait outside the station for a platform to become vacant. There is a timetable, which brings those trains in at the appropriate time. That works most of the time at least. It ought to be possible for NATS to introduce a better system to avoid stacking. I am disappointed that the Government have not progressed that satisfactorily. If there are so many downsides to Heathrow environmentally, on health grounds and economically, what is the Government's amendment about? What is their consultation paper about? What is the motivation behind what they are trying to achieve? One must look carefully at the links between BAA and the Government to try to find some rationale for the position that the Government have adopted.
	People in London particularly have been badly served by the consultation process so far. The Minister will know that the consultation form, which was eight pages long, was widely regarded as full of jargon and technical language and difficult for the average person to understand, so already people were excluded from the consultation process. My hon. Friend the Member for Richmond Park (Susan Kramer) reported the consultation process to the Plain English Campaign, which described it as atrocious and stated that
	no ordinary person with an interest in the plans could be expected to read and understand this.
	BAA had a significant role in the consultation document. I notice that it even has the copyright for the photograph on the cover. The Government came out in favour of a third runway in 2003. They insisted that strict environmental targets should be met on air and noise pollution. That was a sensible policy, but what happened?
	We found out from an article that was published recently in  The Sunday Times that a senior civil servant, David Gray, was tasked with showing how the runway could be built without negative impacts, and showed that an additional runway would mean a lot more air pollution. How could that be avoided? That was his task. He was not tasked with receiving the data and producing a neutral report; he was tasked with fiddling the data and producing a report that was skewed towards BAA and produced the right result at the end.
	I congratulate the hon. Member for Putney (Justine Greening) on her freedom of information request, which showed that the unsatisfactory initial results led to executives from BAA being given unrivalled access to Whitehall and confidential data so that they could select alternative input data for environmental predictions until they got the right results. That is a disgrace and it shows that the Government concluded in the consultation paper that a new airport the size of Gatwick, effectively, could be bolted on to Heathrow as a new runway without any adverse environmental impact. It is astonishing that they could have reached that conclusion.
	We know from BAA that it now has as its director of public affairs Tom Kelly, Tony Blair's former Downing street spokesman, who famously called Dr. David Kelly a Walter Mitty character. It is perhaps Tom Kelly who is a Walter Mitty character living a fantasy life where there is no pollution from aircraft, where clean cars exist so there is no impact from the road movements to Heathrow, and where international flights can be discounted in the calculations of the air pollution that will result from any third runway.
	Even the Government's advisory body, the Environment Agency, has unpicked the Department for Transport document and concluded that it is not sufficiently robust to support the construction of a third runway. It states:
	There are arguments for postponing irreversible investment decisions in the face of uncertainty.
	I have not heard that uncertainty from the Government or from BAA. They appear to be quite certain that the environmental impact will be negative. They seem to dismiss concerns about health. They appear, however, to be sure that the economic benefits will be substantial. Is it not curious that the position that they have adopted is very similar to that adopted by BAA?
	We know from BAA's previous predictions that they are unreliable. In the mid-1990s, BAA predicted that smaller aircraft would disappear, and when it lobbied for terminal 5 it said that there would be 453,000 flights at Heathrow by 2013. That is what BAA said in 1995. That figure was reached by July 2000. What it predicted would take 18 years took only five years.
	Can the Minister answer one specific question? Why was it thought appropriate to exclude international flight arrivals from any calculation of the environmental impact arising from the third runway?
	There is a revolving door between the Government and BAA; not only Tom Kelly is involved. Joe Irvin was a special adviser at Downing street and went on to become a director of public affairs at BAA. Another former BAA public affairs director is Stephen Hardwick, a former policy adviser to the right hon. Member for Kingston upon Hull, East (Mr. Prescott), the former Deputy Prime Minister. That new revolving door syndrome is a new version of Labour spin that goes round and round between BAA and the Government.

Claire Curtis-Thomas: I am concerned about the notion that BAA, which at the height of the construction project for the new terminal had 60,000 employees on site and a budget of 4.3 billion, might operate on its own without any reference to the Government. Frankly, I am delighted that it went to the Government and sought consultation on the exercise. Any investment of that scale, employing such numbers of people, should be of interest to the Government.

Norman Baker: It is perfectly proper for any institution in this country to seek investment, and it is appropriate that a consultation exercise is undertaken. It is perfectly normal for large corporations, bodies, pressure groups or others to engage with the Government at the appropriate juncture; there is nothing wrong in that.
	What is wrong about this issue is that a line has been crossed because BAA has been involved in writing the consultation paper. It has not simply provided facts and figures, as it maintainsthe memos that the hon. Member for Putney helped to secure show that it went much further than that. They show that BAA was helpfully redrafting and suggesting to the Government how particular information could be eliminated and how particular environmental outcomes could be redrafted. It was sending memos to that effect to the Government.
	That worries me, because the Department for Transport appears to be subject to regulatory capture by BAA. That should worry the hon. Member for Crosby (Mrs. Curtis-Thomas); she is getting a response not from her Government, but from BAA. BAA is perfectly within its rights to lobby and make its case, but not to take over the aviation policy of the Department for Transport, although it appears to have done that to a large degree in respect of Heathrow.

John Randall: I would like clarification on where the hon. Gentleman's party stands on runway alternation, bearing in mind the text of its motion.

Norman Baker: We are in favour of ending [Interruption.] No, I mean that the motion should have said ending.

Susan Kramer: As the hon. Member for Uxbridge (Mr. Randall) will undoubtedly have noticed, a cap of 480,000 is permanently and firmly placed on flights at Heathrow. Ending runway alternation would add another 45,000 flights; it is therefore impossible for the motion to be read in any other way than that runway alternation should be preserved and that mixed mode should not be introduced.

Norman Baker: I am grateful to my hon. Friend. I referred to the word ending; I concede that, unfortunately, it is missing from the motion. I accept that it is missing, and I am sorry about it. That one word is missing. I suggest that Conservative Members will have their own explaining to do in a moment about their own policy. The motion leads to no interpretation other than our total opposition to a third runway at Heathrow. We are clear that a third runway there has to be stopped at all events and under all circumstances. The House should be in no doubt whatever about that.

Theresa Villiers: Will the hon. Gentleman repeat what he said a few minutes agothat the Liberal Democrats support ending runway alternation at Heathrow?

Norman Baker: I have already answered that. Let me read the sentence from the motion:
	the increase in intensity and distribution of noise for those living under the flight path through
	the word ending is missingrunway alternation. Our policy could not be clearer.  [Laughter.] Well, let me tell the House what the policy is in one sentence: it is to oppose any third runway at Heathrow under any circumstances. I challenge the Government and the Conservative Front Bencher to match that pledge. We would not build or support any third runway at Heathrow under any circumstances. I invite the hon. Member for Chipping Barnet (Mrs. Villiers) to make a similar pledge when she speaks in due course.
	Voters in London will have to look at three parties in the local elections, the mayoral election and the general election in respect of policy on Heathrow. We know that the Government have been captured by BAA in terms of policy, and we will find out where the Conservatives stand with their chaotic policy on Heathrow. We are the only party in this House that will oppose the third runway at Heathrow under any circumstances.

Ruth Kelly: I beg to move, To leave out from House to the end of the Question, and to add instead thereof:
	recognises that the Government's policy on airport expansion is consistent with its long term, balanced and sustainable aviation strategy as set out in the 2003 White Paper The Future of Air Transport, that its support for emissions trading represents the most effective way of tackling climate change concerns, that the Adding Capacity at Heathrow Airport consultation is a robust document that is the product of a lengthy period of comprehensive analysis, that the consultation process followed best practice as set out by the Cabinet Office, that the economic case for the expansion of Heathrow Airport, as set out in the consultation, accurately reflects the Government's current understanding of all the relevant costs and benefits, and that Ministers should base their forthcoming decisions on the future of Heathrow on all the evidence available, including the responses to the consultation.
	Let me start by congratulating the hon. Member for Lewes (Norman Baker) on securing this debate. As is already clear from his characteristically robust speech, we are not going to agree on much today, but at least we agree on the importance of the subject, which, as he knows, raises strong passions. I understand that, and I also understand that the decision that we make on Heathrow, and indeed our wider aviation policy, will have a major impact on the continued prosperity of our country, our quality of life and our freedom to travel.
	I find it a little odd that the successors to the Liberal party now appear to see it as their role to tell millions of people how and when they can travel, but that is the result of the decisions made by the hon. Gentleman and his colleagues. As he clearly stated, they have set themselves against any expansion not just of Heathrow but of any airport in the south-east. They clearly want the growth in air travel in the UK to be thwarted, and at least they are consistent in their opposition. They do not, of course, want to be quite so clear in telling millions of people in the UK that they intend to make it much more difficult for them to enjoy a holiday abroad, and neither are they quite so clear in explaining that one of the key factors in a global marketplace is good links with the rest of the world and that their policy would worsen those links, with a serious impact on jobs and prosperity. Nor do I recall the hon. Gentleman clarifying the point that restricting capacity at Heathrow would merely mean that passengers who want to use a hub airport would continue to use other hub airports in Europe, damaging Britain but with zero impact on the level of carbon emissions.

Susan Kramer: Can I take it from what the Secretary of State has said that she backs predict and provide and that the principles she has outlined will guide aviation taxation and other green tax policies provided by the Governmentin other words, that priority will be given to meeting demand, not to dealing with emissions?

Ruth Kelly: No. I thank the hon. Lady for her comments, but predict and provide is not the policy of this Government. She should look back at the 2003 transport White Paper, which makes it clear that even with the expansion of all the airports that were supported in that document we would not meet predicted demand for air travel in future. We need a tough approach that recognises the impact on the environment as well as the genuine concerns of local people. We have put forward a balanced approach.
	I am not surprised by the opposition of the hon. Member for Richmond Park (Susan Kramer) or by that of her Front Benchers, but I find it remarkable that the Conservatives have reversed their position and adopted the Lib Dem policy as their own. A party that once stood for choice and for a strong economy is now in favour of restricting choice and ready to put the economy at risk in the cause of short-term political gain. I am sure that many Tory Back Benchers will be horrified at that change of position.

Theresa Villiers: Before we can take a responsible decision on the future of Heathrow airport, we want the Government to answer the key environmental questions and to produce objective, trustworthy data on the key environmental tests that have to be met.

Ruth Kelly: That is precisely what we are committed to doing, and it is not in the wording of the Conservative amendment.

Theresa Villiers: How can the Secretary of State possibly say that she is answering the questions on, for example, NOxoxides of nitrogenwith legally binding limits applicable from 2010? The Environment Agency has said that her evidence is not sufficiently robust, so even her own advisers on environmental matters do not believe the Government's case.

Ruth Kelly: We need to examine the local environmental conditions that we said are necessary to be met in order for us to decide, if that is indeed the case, that this should go ahead. We have put these proposals and the scientific evidence out for consultation to be publicly tested and scrutinised by the Environment Agency and others, and I will not make a decision until all the responses have been analysed.

John McDonnell: The Secretary of State mentioned the decision. Can we have clarity about how it will be made? At the end of the consultation process, will the decision be made through a vote on the Floor of this House before we move to any future stageif we do so at all?

Ruth Kelly: It will be important for the Government to take a decision and for the proposals to go through the planning inquiry. One of the options for the House to consider is how planning procedures should be speeded up in future, and we will have to consider a national policy statement on aviation, and the point at which that comes in. Those decisions are yet to be determined.

Theresa Villiers: rose

Ruth Kelly: I give way to the hon. Lady, who is obviously desperate to join the debate again.

Theresa Villiers: I am grateful to the Secretary of State; she is generous in giving way so many times. How can she possibly say that decisions have yet to be made when she stands at that Dispatch Box month in, month out, expressing fulsome support for building a third runway at Heathrow? She has already made up her mind. The consultation is a complete sham.

Hon. Members: Absolutely.

Ruth Kelly: Absolutely not, and in the course of my speech I intend to set out the arguments that were expressed in the 2003 air transport White Paper for more capacity at Heathrow. At the same time, however, we have always said that we would not go ahead unless the strict local environmental conditions were met. We promised thenI shall return to this pointthat we would present the detailed modelling evidence for public scrutiny in order to test the robustness of the case before any decisions were made.

Theresa Villiers: rose

John Redwood: rose

Ruth Kelly: I am delighted to see the right hon. Gentleman rise to his feet. I am sure that he is distressed by the U-turn on the part of those on his Front Bench.

John Redwood: I think it is time for me to ask questions, rather than answer them. Will the Secretary of State tell us how long she thinks it will take to reach a decision, assuming the accelerated planning processes are approved? People on both sides of the argument would like to know when we will get a decision on this crucial matter. Were the decision to be in favour, could she promise generous compensation for those adversely affected?

Ruth Kelly: I am afraid that it is not possible for me to predict the length of the planning process because decisions have yet to be taken. It is important that the planning process is robust, and that all considerations, such as the health impact, which was raised by the hon. Member for Lewes, are taken properly into account. If there were a decision in favour, of course it is right that BAA would compensate individuals and communities that were affected. I am delighted that the right hon. Gentleman got to his feet. He has been brave in taking on these arguments in his own party, like the hon. Member for Havant (Mr. Willetts), who valiantly confronted the sceptics at Hounslow, no less, when he said that
	no responsible party can simply say that we can put up the shutters and there's not going to be any more runways anywhere in the South East if we want London to remain a serious global city.
	The Conservative amendment demonstrates the lack of leadership and the short-term political opportunism of a modern Conservative party that is prepared to put short-term political gain ahead of the long-term national interest of the country.

Justine Greening: The Secretary of State says that she has put the detailed environmental data in the public domain. She has not; that is simply not true. I have been trying since May last year to get the Government to release detailed environmental modelling data under the Freedom of Information Act. What I have got are memos, minutes and board meeting minutes, just as the hon. Member for Lewes (Norman Baker) described. What I have never been given, and am still prevented from getting, are the environmental data. If the Government are so convinced of their case, why will they not give me those data so that we can all be convinced?

Ruth Kelly: I certainly congratulate the hon. Lady on her tenacity. She has been a brilliant campaigner on these issues. The Department has already given her much material to peruse at her leisure, but the fact is that the experts have been out there with workpeer-reviewed in many casesthat has involved some of the most eminent scientists in this country. That process has been led by the Department, and we have presented our evidence.

Justine Greening: On that point, will the Secretary of State confirm that the peer reviewer was the company WS Atkins, which was sought, employed and then paid by BAA?

Ruth Kelly: It is certainly the case that Atkins has peer-reviewed some of the work, but it was not responsible for peer-reviewing all of it. Much of the work was peer-reviewed by the Civil Aviation Authority and independent experts. Noise modelling, which I know the hon. Lady is interested in, was carried out by the CAA, whose expertise is internationally respected. Air-quality modelling followed a two-year programme of research that drew on panels of eminent experts in the field, and a peer review found its conclusions to be
	justified in the light of the current state of knowledge
	and fit for purpose. BAA's air traffic forecast, to which the hon. Lady may be referring, was also subject to careful quality assurance by the Department. I shall deal shortly with the local environmental tests, but I want to cover some of the other points that the hon. Member for Lewes raised.

Claire Curtis-Thomas: I am worried that the reputation of WS Atkins could be besmirched. The implication of comments today is that WS Atkins can be bought. As a member of the profession, I stress that engineers, who make up the vast majority of WS Atkins, cannot be bought. We offer impartial advice and judgment because we are reviewed by our peers and, frankly, we take no notice of politicians' views. Our job is to offer advicethat is it.

Ruth Kelly: I congratulate my hon. Friend on her point. Every hon. Member should listen carefully to those comments. It is important that we do not cast aspersions on the integrity of thosesome of the most eminent reviewers in the worldwho have done the work.

Angus MacNeil: Will the Secretary of State give way?

Ruth Kelly: I promised that I would make some progress and I am going to do exactly that.
	I shall deal with the comments of the hon. Member for Lewes in three parts. First, I shall tackle his point on the Government's overall aviation policy and the case for additional capacity. Secondly, I shall set out the steps that the Government are taking to ensure that we have a sustainable aviation policy, which is compatible with our climate change goals. Thirdly, I want to tackle some of his specific points about the consultation.
	Let me begin by tackling the hon. Gentleman's claim that we should rule out any further increase in airport capacity in the south-east. Air traffic is hugely important for this country. As a global centre for finance, trade and culture, this country's competitiveness relies on good international links. Our recognition of the economic and social benefits of flying is precisely why we support the sustainable growth of aviation, as set out in the transport White Paper in 2003.

Angus MacNeil: rose

Ruth Kelly: Not yet.
	Given the title of the debate, let me focus on the importance of Heathrow. If the hon. Gentleman's point is about capacity there, I will gladly give way.

Angus MacNeil: Perhaps some of the pressures on Heathrow are due to the lack of a high-speed rail link. I have already flown four times this week in relation to my parliamentary duties. On some of those occasions, I have flown over water, although when I land in Glasgow, I would be more than happy to take a train to London, but it is not practical. A few years ago, I had cause to go to Seville. The journey from Seville to Madrid is an equivalent distance to that from London to Glasgow. One can travel from Madrid to Seville in less in two hours. The Secretary of State would find it difficult to travel from Glasgow to London in two hours. Lack of a joined-up transport policy is part of Heathrow's problem.

Ruth Kelly: The hon. Gentleman feels passionately about the points that he makes, and he makes them well. Unfortunately, he is wrong. I have not considered a high-speed rail link from London to Glasgow, but I have examined in detail the case for such a rail link from London to Manchester. There may be a case for high-speed rail, but it is not the one that he makes. If we introduced a high-speed rail line between London and Manchester, the energy consumed would increase by 90 per cent. Indeed, we would get nearly two thirds of the carbon emissions of a domestic jet on a short-haul flight between London and Manchester. High speed does not necessarily equal green. Some people who oppose aviation expansion often propose high-speed rail as an easy way out. There may be arguments for it, but that is not one of them.

David Wilshire: On travelling from Scotland, would the Secretary of State prefer to travel from Glasgow to, for example, Los Angeles directly, perhaps changing at Schiphol, or travel all the way down to a London station, get the underground or a taxi and struggle out to Heathrow to catch another plane? Which is more likely?

Ruth Kelly: The hon. Gentleman makes a good point about the importance of a hub airport. All short-haul domestic journeys by air will never be replaced by rail. It is important for the regions and the nations of the United Kingdom to have access to Heathrow.

Norman Baker: Is the right hon. Lady aware that flights between Paris and Brussels have been eliminated as a consequence of high-speed rail, as have many other flights in mainland Europe? How can aviation and road capacity be expanding in this country, but railways be constrained within the existing lines?

Ruth Kelly: I was not making a case against high-speed rail per se; I was just saying that it is not necessarily a green form of travel. It can be a green form of travel, depending on the energy mix, which is different in France from in the United Kingdom, for obvious reasons. I do not know whether the hon. Gentleman supports the energy mix and production in France

Norman Baker: indicated dissent.

Ruth Kelly: The hon. Gentleman shakes his head. There may be a case for putting more investment in conventional railindeed, we are doing thatbut high-speed rail is not a panacea. There will always be a need for short-haul flights.

Angus MacNeil: rose

Ruth Kelly: No, the hon. Gentleman has had his chance.
	We rely on good international connections to support our national and regional economies, and we need to plan ahead, so that Heathrow is in a position to continue supporting economic growth in 10 or 20 years' time.

Nick Raynsford: Does my right hon. Friend accept that there are many Labour Members, including me, who accept her argument about the country's economic need for continued expansion and the importance of a hub, but who nevertheless do not agree that Heathrow is the right location for it? That is not least because of the clear decision of the inspector, who sat for a disproportionate amount of time considering the previous proposal for Heathrow expansion, which led to the terminal 5 decision, and who, having considered all the evidence, including the importance of a hub, concluded that there should be no further expansion at Heathrow beyond terminal 5. Is it not time to accept that logic and begin work on planning for the one location where a suitable hub airport for the United Kingdom could be established, in the Thames estuary?

Ruth Kelly: I thank my right hon. Friend for his comments. Indeed, I read with interest his article on the issue at the weekend and I know that he has considered such matters in depth. However, let me remind him that in the course of preparing the 2003 White Paper, more than 400 different airport locations were examined, some in great depth. Indeed, the Government actively considered the possibility of an offshore airport, and the preferred site was Cliffe.

Nick Raynsford: Cliffe was onshore.

Ruth Kelly: The preferred site for a new airport, an offshore airport having been considered, was Cliffe. All the relevant factors were taken into consideration, including the distance from London, the up-front cost in infrastructure investment, the labour supply that would be able to work in the airport and the impact on the local environment, particularly the ecosystems, including birds and wildlife, yet none of the sites was considered suitable.

Alan Keen: Does the Secretary of State regard the birds as more important than my constituents in Feltham and Heston who live adjacent to Heathrow airport? Also, does she accept Lord Soley's argument that if Heathrow does not expand, it will become a desert? However, if it expands dramatically, where will the fourth runway go and how many thousands of houses would have to be knocked down?

Ruth Kelly: I know that my hon. Friend feels passionately about the subject and has championed his constituents' interests with force and tenacity, in this place and elsewhere. No, it is not the case that the birds have priority. In fact, the presence of so many birds is a safety hazard for planes. That was one of the issues taken into account when examining different locations.
	I understand that my hon. Friend refers, too, to commitments that BAA made at the time of the previous planning inquiry. The Government then did not commit themselves to a decision at that point, but we considered all such matters afresh in the 2003 White Paper. I know that he disagrees with the Government's position, and he is entitled to his views, representing his constituents.

John Randall: rose

Norman Baker: rose

Ruth Kelly: I must make some progress, although I will take one intervention from the hon. Member for Lewes, whose debate this is, after all.

Norman Baker: On commitments made in the past, I referred in my contribution to the right hon. Member for Newcastle upon Tyne, East and Wallsend (Mr. Brown), who promised in 2001 that the number of flights was capped and that there would be no further increase, but now the Secretary of State is proposing to go back on that. Will she stick to that pledge?

Ruth Kelly: The hon. Gentleman knows that the 2003 White Paper stated the Government's position. One of the things that we are considering in the consultation is whether that cap should be lifted. Indeed, the mixed-mode proposalending the alternate use of runways, as he may prefer to put itcontains two options to be considered: one within the existing cap and one raising it. The Government have an open mind on those issues. We want to hear what local people have to say, particularly on how noise would affect them in the intervening years before a third runway could come into operation.
	The sad fact is that, no matter what changes are made in the short term in terminals at Heathrow, it will count for little unless we really tackle the fundamental problem of capacity on Heathrow's runwaysand the truth is that those runways are nearly full. Indeed, Heathrow is falling behind because its runways are operating at 98.5 per cent. capacity, compared with 75 per cent. at Paris. Our most important international airport has lost a fifth of its routes since 1990 and has fallen from second to fifth in the EU for routes served.
	China is building 60 new airports over the next five years but, as things stand, Heathrow will have no extra capacity to serve emerging markets, which has clear implications for our economic competitiveness and for the passenger experience in the future. At Heathrow, which still has the same two runways it had when it was built in the 1940s, even a small amount of fog in the early morning can disrupt services for the rest of the day. Of course, operating at peak capacity gives its competitors abroad a huge advantage.
	So there is a clear need for additional runway capacity at Heathrowa point recognised even by the hon. Member for Chipping Barnet (Mrs. Villiers) at the launch of the consultation, when she said that the Conservatives
	recognise that the economic arguments for expanding Heathrow are much stronger than any other airport in the South East.

Theresa Villiers: rose

Ruth Kelly: But perhaps she has changed her mind.

Theresa Villiers: The point that I was making was that the Government's misconceived plans for expanding Stansted have no justification whatever [Interruption.]

Ruth Kelly: The hon. Lady is clearly flip-flopping on this issue, like so many other Opposition Front Benchers. Perhaps she would agree that, for London to be a world capital, it needs excellent links with the rest of the world.

Several hon. Members: rose

Ruth Kelly: I will not give way at the moment.
	Our analysis shows that a third runway at Heathrow would provide net economic benefits of about 5 billion, even after taking accountfull accountof climate change and noise costs.

Justine Greening: rose

Susan Kramer: rose

Ruth Kelly: Let me turn to my second theme and make some progress, as I know that many Back Benchers want to speak in the debate. I must set out the steps that we are taking to ensure that we have a sustainable aviation policy that is compatible with our climate change goals.
	There are, of course, huge challenges in how we enjoy the benefits of air travel while still meeting our climate change objectives. We all know that climate change is one of the biggest threats facing the global community today and that if it were left untackled the implications for our way of life would be catastrophic. There are no easy answers, but when Sir Nicholas Stern looked at the question of how to tackle climate change without putting economic growth at risk, he suggested a three-pronged approach: making sure that carbon costs are reflected in prices to consumers; promoting greener technology; and offering consumers information and choice. Those three elements are clearly applicable to aviation. Let me take each briefly in turn.
	First, it is clearly important that the cost of air travel reflects its impact on the environment. I turn here to the point raised by the hon. Member for Richmond Park in an earlier intervention. We consulted on the emissions cost assessment, which was specifically designed to consider how far aviation was meeting its external climate change costs. The consultation document used figures that pre-dated the increase in air passenger duty, on which the Treasury is currently consulting. Since APD was doubled, aviation will meet its climate change costs, taking account not just of carbon dioxide emissions, but of the other aviation greenhouse effects such as NOx emissions and contrails.

Susan Kramer: I thank the right hon. Lady for her generosity in giving way. Just on that issue of the shadow cost of carbon, to which I assume she is referring, will she confirm that it is based on an assumption, first, that the Government have the right target for emissions and, secondly, that they will hit that target? The calculation is, therefore, that there will be only modest carbon costs because the risk of climate change will have been mitigated by those other measures. In other words, the pricing used in this calculation depends on a perfect world scenario rather than being within the range of pricing that most of us would consider prudent at a time when we are debating even what climate change targets should be. It is, in other words, inadequate.

Ruth Kelly: I may be out by a pound or two, but I think that the price that we are putting on carbon is about 25 per tonne of CO2, increasing by 2 per cent. in real terms year on year. As Nicholas Stern pointed out, there is a range of carbon prices that could be used, but when he was asked on the Today programme whether we could view our current policy on aviation expansion and road building as compatible with meeting our CO2 targets, he said, I believe we can. Not only that, the figures that we have put forward are robust to different scenarios for the shadow price of carbon. We have estimated the net economic benefit to be about 4.8 billion, and it would clearly be possible to increase the shadow price of carbon significantly without cancelling out that benefit.
	Ultimately, however, the international nature of the aviation industry means that action to tackle environmental impacts is most effective if it is delivered on an international basis. We have been pressing for greater worldwide progress on the environment in the UN's International Civil Aviation Organisation, but perhaps most important is the fact that we have been leading negotiations in Europe to include aviation in the European Union's emissions trading scheme. If that happens from 2012, as is currently proposed, any extra carbon emissions from an expanded Heathrow will be balanced by a reduction in emissions from other, more cost-effective parts of the economy. In effect, net carbon emissions would be stabilised at 2004 to 2006 levels, which would constitute a significant improvement on the position today.

Justine Greening: As has already been mentioned, the carbon cost was calculated on the basis of just half the total number of flights that would depart from Heathrow and the extra capacity that would be created. The calculation also left out the emissions from the new terminal, and those resulting from any of the journeys of the 40 million-plus non-hub passengers who would have to travel to and from the airport. How can the Secretary of State claim that the figures are robust when she has gone against DEFRA's own guidelines in calculating the emissions for this policy?

Ruth Kelly: We have not gone against DEFRA's guidelines at all. In fact, terminal 5 will be one of the greenest airport buildings in the world. It would be ludicrousthe hon. Member for Lewes asked me to respond to this pointto include flights leaving London and flights arriving there for the purposes of a trading scheme, as it would be double-counting the impact of carbon dioxide emissions.

Justine Greening: rose

Ruth Kelly: I will not give way to the hon. Lady again. I have already given way to her several times.
	The second important issue is technology. We must continue to press for greener planes, greener airports and greener skies, but we are already seeing progress. New aircraft today are typically 20 per cent. more fuel-efficient than the aircraft that they replace, their noise footprint has been more than halved, and they carry more passengers.
	We can improve the way in which we manage air traffic. The single European sky proposals will harmonise air traffic control across Europe, streamline routes, and reduce the need for stacking of planes on the approach to airports. I am also keen to examine the potential of green slots. If there is additional capacity at Heathrow, why should it not be used to try to encourage a new breed of more environmentally friendly planes?

John Randall: Climate change issues are of course very important, but there is one issue that the Secretary of State has not mentioned so far. I have a feeling that she is not going to mention it, although I may be wrong. Will she tell me what consultations and discussions she has had with local authorities, or with anyone, about where she will house the people whose homes have been destroyed? Where will those communities go? It is not just people in Sipson who will be affected, but those in all the surrounding areas: Harmondsworth, Harlington, Longford and West Drayton. The area is already overcrowded, and there are an incredible number of housing problems. What thought has the Secretary of State put into that?

Ruth Kelly: My hon. Friend the Member for Poplar and Canning Town (Jim Fitzpatrick), the Aviation Minister, has met all the council leaders and residents' groups who have expressed concern, and rightly so. We would never make such decisions lightly, because people's houses and livelihoods are potentially at stake. We cannot make a decision that is based purely on the impact on the local communitywe must balance that against the impact on the nation as a wholebut it is right for those people to be compensated, and the issues will be examined carefully as part of the planning process. We expect the compensation to be generous, and I think that BAA has been assiduous in providing information for local people.

John Randall: rose

Ruth Kelly: I must make some progress. I have already been speaking for more than half an hour.
	The third point raised by Nicholas Stern is how we can give people real information and choice in how they travel. I have already dealt with the issue of high-speed rail, but let me say now that we are investing in rail. We have the fastest-growing railways in Europe, and we plan to accommodate a doubling of capacity over the next 30 years. Far better than my giving that promise to the House is for me to give the facts, which speak for themselves. Whereas in 2004 two thirds of journeys between London and Manchester were made by air, two thirds are now made by rail, thanks to the 8 billion that we have spent on modernising and upgrading the west coast main line.
	That brings me to my third and final theme. Of course, none of our ambitions on aviation can be realised unless we meet the strict local environmental conditions on noise, air quality and transport access set out in the White Paper.

Jim Cunningham: So far in the debate no Member has mentioned the aircraft engine manufacturers. Rolls-Royce, for example, has invested heavily in cleaner engines and reducing fuel consumption. Have the Government had any discussions with the manufacturers, because it is worth noting that that is a major factor in encouraging manufacturers to invest more in research and development in this area?

Ruth Kelly: My hon. Friend makes an important point, and I know that the Secretary of State for Business, Enterprise and Regulatory Reform in particular has been looking at these issues and talking to manufacturers of aircraft engines and other industrialists. Despite there being almost three quarters more aircraft movements in 2005 than in 1975, the number of people affected by noise has fallen by almost 90 per cent., which shows how much quieter aircraft are becomingand they have also become much more fuel efficient.

Susan Kramer: Will the right hon. Lady give way?

Ruth Kelly: No, I must make progress.
	The White Paper announced a programme of work to consider how further capacity could be added, or how to make best use of the existing runways, while meeting critical local environmental tests. It committed to consulting on the outcomes of this work, once complete. The air transport White Paper made it absolutely clear that the Government did not intend to conduct this further work on their own. Indeed, it would not have been sensible, or even possible, to attempt it without the technical and operational expertise both of the airport operator and of other key stakeholders. The White Paper explicitly stated, in paragraph 11.63:
	We will therefore institute immediately, with the airport operator and relevant bodies and agencies, a programme of action to consider how these conditions can be met in such a way as to make the most of Heathrow's two existing runways and to enable the addition of a third runway as soon as practicable after a new runway at Stansted.
	The consultation that I launched last November, and which closed in February, met that commitment. In it, we presented our evidence that the local environmental conditions could be met at Heathrow, and we invited scrutiny and comment from any interested party or individual.
	There has been a lot of comment in the debate on these specific tests. However, the facts that I have quoted on noise show that over time it is perfectly possible to have a quieter fleet of aircraft, with fewer people affected by noise and with more fuel-efficient engines. The key question is whether over time we can have more aircraft within that same 57 dB noise contour without infringing the European limits on air quality, and with sufficient transport access.

Susan Kramer: I thank the right hon. Lady for giving way. She will be aware from her conversations with aircraft manufacturers that all the quick and easy gains on both noise and fuel efficiency have been captured, and that there are no immediate major technological breakthroughs on the horizon. In terms of noise, is that not confirmed by her choice of a benchmark year when Concorde was flying? Because of the averaging techniques she used, we will be talking about keeping noise not at today's levels, but at levels as they used to be if we were able to take Concorde's allocation of noise, as it were, and average outeven if we agreed on how to measure noise.

Ruth Kelly: Unfortunately, I disagree entirely. That was the latest available year, and the Concorde issue is not significantly relevant to the calculations. The hon. Lady is right that there is no step change in technologyas there may be in car technologywhich could within the next two, three, five or 10 years transform the way aircraft fly, but year by year there are significant improvements in the efficiency of the fleet. Even more important than that, the fact is that we will have a cap at European level on the amount of carbon that can be released, and trading will take place beneath that cap. That will be at the level of 2004 to 2006, which is below where we are today.

Martin Linton: rose

Angus MacNeil: rose

Ruth Kelly: I shall give way one last time, and I shall do so to my hon. Friend the Member for Battersea (Martin Linton).

Martin Linton: Does my right hon. Friend accept that she should be looking at not only the 57 dB contour but the 54 dB contour, and that under mixed mode, which is one of the proposals she is considering, that 54 dB contour would be increased enormously by more than 130,000 people right across south London? At present, it ends in Stockwell; it would go right over to New Cross and bring hundreds of thousands more people in south London into the 54 dB contour.

Ruth Kelly: My hon. Friend is certainly right to draw attention to the fact that the noise impact with mixed mode, or the potential better use of existing runways, is very different from the noise impact with the third runway. Over timeby 2030far fewer people than at present would be affected by 57 dB, or indeed, I think, by 54 dB. The question that we are consulting on openly is whether we should try to bring forward capacity in the intervening years, which could help both to support the economy and improve the passenger experience at Heathrow. We are asking for views on whether that different distribution of noise level would be acceptable to the local

Angus MacNeil: rose

Ruth Kelly: I have said that I am not going to give way any more.
	As in many areas of national policy, we face vital long-term decisions over Heathrow and air travel in this country. They require the Government to consider carefully the long-term needs of our country and to balance often conflicting interests. Even the hon. Member for Lewes would find it difficult to describe his party's position as balanced. Through policies that I believe are both balanced and effective, we can meet our economic needs and environmental obligations. This Government will put into place those balanced and effective policies, which, as this debate has already underlined, the Liberal Democrats and the Tories are determined to oppose. I therefore urge my hon. Friends to support the Government's amendment.

Theresa Villiers: The truth is that the Government are determined to press ahead with Heathrow expansion, regardless of whether hugely important environmental questions are answered and even before they have considered the consultation results. Their consultation is simply a sham, because Ministers stand at the Dispatch Box month in, month out expressing their support for a third runway at Heathrow. The Prime Minister is also a strong and vocal supporter of expansion.
	The Opposition believe that the Government have failed to make the case either for a third runway or for an end to runway alternation at Heathrow. We will therefore vote against their amendment. Our position is set out in the amendment that we have tabled, but because it has not been selected we will not have the chance to vote on it. We shall abstain on the Liberal Democrat motion. As my speech will show, we agree with elements of it, but we do not believe that it is possible for airport policy in the south-east to be set in stone for ever in all circumstances.
	Moreover, I am deeply concerned that the Liberal Democrats will go through the Lobby to support a motion that condemns runway alternation and asserts that it increases noise annoyance for residents. For thousands of people across the capital, runway alternation gives a welcome respite from aircraft noise. The Government's proposals to introduce mixed mode are deeply controversial with those who wait every day for the 3.30pm switchover of runways. The Liberal Democrats have got this matter badly wrong, and that is one reason why we will abstain on their motion.

Susan Kramer: Does the hon. Lady agree that because a process of consultation is under way and the Government are going to make a decision, this is the day to draw the line in the sand and permanently to say no to the third runway? Will she refuse to join us in that stand simply because of a typo?

Theresa Villiers: As I have just said clearly, we do not believe that the Government have made the case either for a new runway at Heathrow or for mixed mode. They have failed to make the economic case for expansion. A recent study by CE Delft for the Heathrow Association for the Control of Aircraft Noise throws into question the analysis in the Oxford Economic Forecasting report, which has been the foundation for the economic case since its publication.
	The consultation document published by the Secretary of State last November includes increased tax revenue from air passenger duty as a benefit to the economy, but of course it is only a transfer from the private to the public sector. Crucially, neither the consultation document nor the OEF report puts a credible price on the impact of expansion on local air pollution or noise. Those who live under the flight path tell us clearly that noise has an obvious economic impact, not least on the value of their homes.
	The Secretary of State has simply failed to address the four key environmental tests that we set for her when she published her consultation document. The Opposition believe that they must be met before a responsible decision can be made on Heathrow's future. The tests are: whether expansion is consistent with meeting EU rules on oxides of nitrogen emissions, which will become binding from 2010; whether expansion is consistent with ensuring that there is no increase in the overall noise footprint in the airport and with a progressive reduction of that footprint in the medium term; whether expansion is consistent with meeting our climate change targets on CO2 reduction; and whether all the alternative ways to free up capacity at Heathrow have been fully considered, including serious and urgent consideration of high-speed rail. The Government have failed to meet those tests and to produce the objective and reliable data that would allow a sound judgment to be made on the pros and cons of expansion.

Steve Webb: If the hon. Lady receives satisfactory answers to her four questions, will she confirm for the avoidance of doubt that in some circumstances the Conservatives will approve of a third runway at Heathrow?

Theresa Villiers: We have had no satisfactory answers to the questions, and that is my point. The Government have failed to produce objective and reliable data and the documents obtained by my hon. Friend the Member for Putney (Justine Greening) under the Freedom of Information Act demonstrate the Government's efforts to fix the figures to suit the case that they want to make. They show close involvement by BAA in the data and modelling used by the Government in those critical environmental issues, despite the fact that the company's direct and obvious commercial interest in the outcome of the debate means that it cannot possibly be disinterested.

Ruth Kelly: I would be delighted if the hon. Lady could confirm that she disagrees with the statement made by the Leader of the Opposition last Friday to a business audience. He said of Heathrow that it
	should go through the planning system in the proper way.

Theresa Villiers: I do not know whether the Secretary of State thinks that cosy meetings at BAA headquarters to reforecast and fix the figures to get the answer that is wanted are a proper way to conduct the planning process, or indeed any other process. I do not think it was proper for the Secretary of State to make up her mind before the planning process even started.

Angus MacNeil: A further question sprang from the one intervention that I managed to make on the Secretary of State. It seemed from her answer that she prefers to fly between Glasgow and Edinburgh rather than using high-speed rail. Of course, she is free to clarify that point if she wants to. What is the Opposition Front Benchers' preferred form of travel between mainland cities in the UK? Is it air or rail?

Theresa Villiers: I am delighted that the hon. Gentleman has brought up that issue. Frankly, I was enormously disappointed by what the Secretary of State had to say about high-speed rail. It was astonishing. At the end of my speech, I shall talk in detail about how we think we should progress with that issue.

Ruth Kelly: I am really confused. The Leader of the Opposition said to a business audiencewe know that the CBI, the British Chambers of Commerce and London First all support the expansion of Heathrowthat once the consultation process the Government are carrying out is complete the policy should proceed through the planning process. I do not know whether the hon. Lady understands that we have not gone through a planning process but, rather, consultation on the evidence. Does she disagree with the Leader of the Opposition that it should now proceed to the planning process and go through that detailed level of inquiry?

Theresa Villiers: I have already answered that question, so I shall go back to my speech.
	Let me take each of the four issues in turn. NOx pollution probably provides the greatest practical hurdle for the Government's expansion plans.

Norman Baker: Will the hon. Lady give way?

Theresa Villiers: No. The hon. Gentleman has had his chance.
	As we have heard, NOx pollution can worsen bronchitis, asthma and respiratory problems. It is a serious issue. Heathrow's proximity to the M4 and the M25, which are some of the busiest roads in Europe, means that there is already a significant problem with NOx emissions from cars travelling to the airport. As we have heard, tough new EU limits on NOx emissions will become legally binding from 2010. Already, the combined emissions from air and surface traffic see limit values regularly exceeded around the airport. The Government simply have no credible plans for how to meet the limits in the EU directive with an expanded airport that will have nearly 50 per cent. more flights and a possible increase in the number of passengers a year from 67 million to about 135 million. The only hope of dealing with that problem would be to secure a major modal shift on to public transport, yet Government targets set eight years ago to increase public transport use for travel to Heathrow have not been met. BAA has actually reduced its targets in that area.
	The Government have effectively abdicated responsibility for the issue, leaving it to BAA to solve. That, of course, leaves open the possibility that cheaper options such as M4 congestion charging or a 20 airport drop-off fee might be the preferred commercial solution, regardless of the views of local people and the impact on local business, as opposed to more imaginative, but I would have thought, more expensive proposals such as that from Ove Arup for a Heathrow northern hub to link in with the national rail network.
	On NOx, the Government are making an enormous leap of faith. They are banking on a major advance in vehicle technology providing the headroom to allow the number of cars to increase significantly without an overall increase in NOx emissions. Astonishingly, they are basing their optimistic assumptions at least partly on data and analysis supplied by BAA. Even the Environment Agency, the Government's own environment adviser, stated that the Government had not produced robust evidence on dealing with that serious problem.

Claire Curtis-Thomas: Will the hon. Lady give way?

Theresa Villiers: I will in one moment.
	The agency also highlighted the morbidity and mortality impact of such pollution on a dense local population around Heathrow. If the hon. Lady can give me the answer to the NOx question, I shall happily give way.

Claire Curtis-Thomas: I suspect that I am one of the very few Members who has actually done NOx emission testing, as well as SOxsulphur oxidesemission testing, for more than 18 months, so I think I know what I am talking about. On NOx emissions, I was fortunate to be one of the first people in the country to implement Tory legislation on NOx emissions. It was immensely difficult, because the legislation was passed but there was no instrumentation to measure the level of NOx emissions. There is always a dispute between technologies when we come to measure NOx emissions. There will be a dispute here, and we should surely seek a correlation of opinion that satisfies the majority. All companies that produce the equipment could be prosecuted by Europe, and I hope that they would be. They are striving to achieve the emission levels that we are seeking.

Theresa Villiers: Of course it is essential that we have reliable measurement, but that still does not explain how the Government will deal with the NOx problem and achieve the shift on to public transport that is needed to deal with it.
	Secondly, we all know that aircraft noise is hugely important in terms of its impact on the quality of life of thousands across the south-east who live under Heathrow's flight paths. The Government assumewe have heard it again today from the Secretary of Statethat by the time a third runway becomes operational, a whole new fleet of quieter aircraft will be in the air. I certainly hope that there will be significant improvements in the fleet mix and a shift to quieter engines, but again the Government's predictions depend at least partly on data supplied by BAA, and Ministers have wholly disregarded the Attitudes to Noise from Aviation Sources in England report, which they themselves commissioned. It concluded that annoyance from aircraft noise starts at a much lower level than is set out in the criteria that the Government are using. Furthermore, after their shameful bid to lift the cap on night flights, the Government still refuse to give long-term guarantees that that vital protection will be retained. Frankly, the obligations that they place on BAA to pay for noise insulation for schools and homes affected by Heathrow are wholly inadequate.
	Thirdly, the Government have simply made no proper effort to explain the impact that a projected increase to 702,000 flights at Heathrow will have on the fight against climate change. Even if they promised to cap flight numbers, which they have yet to do, who would believe them? They were, after all, the Government who started pressing ahead with proposals to dispense with the 480,000 limit set for T5 before the terminal had even opened for business. Controversially, as we have heard, the Government's carbon calculations failed to include the impact of inbound international flights, but they also failed to include the impact of thousands of cars arriving at the airport every day to drop off passengers.
	Fourthly, and finally, the Government have failed to look with any real seriousness at the alternatives to a third runway or mixed mode. HACAN ClearSkies, which has campaigned on the issue for many years, has highlighted the significant number of flight movements at Heathrow to destinations where there is a viable rail alternative. As the Aviation Minister told the House on Monday, the experience with high-speed rail in France has shown that, where a good rail alternative is available, consumers will frequently choose it over flying.

Ruth Kelly: I have a simple question for the hon. Lady: does she support aviation expansion in the south-east? Yes or no?

Theresa Villiers: We need answers to the environmental questions about the future of Heathrow.
	Even conventional rail can help to deliver modal shift, as the Secretary of State has pointed out. That has been demonstrated by the reduction in flights between London and Manchester as a result of even the limited improvement to the west coast main line in recent years.
	If we could find a way to make progress towards building a north-south high-speed rail link to Heathrow and the channel tunnel, we could dispense with hundreds of the flights now clogging up the airport. On the eve of the launch of the channel tunnel rail link, I called on the Secretary of State to work with me in taking forward the case for more high-speed rail in this country, but she declined. The Government have set their face against high-speed rail, and the right hon. Lady made that even clearer today than she has in the past.
	The Government have missed a huge opportunity to transform the debate on airport expansion. I urge the Secretary of State to reconsider the Government's position and to make a full and proper assessment of whether high-speed rail could provide solutions to a very difficult problem.
	In conclusion, the Government have fiddled the figures on Heathrow, and they have failed to address the key environmental test or to give proper consideration to the viable alternatives to Heathrow expansion. They have also failed to make the case for expansion, and that is why we shall vote against the Government amendment this afternoon.

Several hon. Members: rose

Madam Deputy Speaker: Order. Mr. Speaker imposed an eight-minute time limit on Back-Bench speeches. However, because of the limited amount of time, I am going to impose a six-minute limit on Back-Bench contributions in the hope that all those who wish to speak will be able to do so.

Alan Keen: I shall be as brief as possible, although even eight minutes would not have been enough for me to make a proper argument about the important issues that we face.
	The Secretary of State said that I was passionate about Heathrow airport and air transport. I used to be very proud of Heathrow, and in fact 45 years ago this week I first started work only a few miles away from the airport. I have lived and worked within six miles of it ever since, and I understand the air transport industry very well. More than anything else, however, I am passionate about my constituents who suffer from the noise. Improvements to aircraft engines may lead to greater quietness, but that is irrelevant: unless engines become completely silent and planes are able to take off and land vertically, many thousands of people in west London will still be affected to their detriment.
	I shall put a very simple argument on behalf of my constituents, but if I get time I shall also read out some of the comments that I have received from them. I shall then leave it to you, Madam Deputy Speaker, to stop me.
	If I seem a bit shaken, it is because a note from my office was passed to me a few minutes ago. The note said that the Under-Secretary of State for Health, my hon. Friend the Member for Brentford and Isleworth (Ann Keen)who has campaigned against a third runway for five yearswould be unable to attend the debate because she was on a maternity visit. I only hope that she is making the visit in her capacity as a Health Minister. If that is not the case, I hope that the House will wish me welland that it is a girl.  [ Laughter. ] She will kill me later.
	In the short time available to me, I shall concentrate on the two main problems facing my constituents. The first is the Cranford agreement; the consultation asked whether people wanted it to be scrapped. The agreement has existed since the 1950s. It has never been written down, but it ensures that planes always take off from the southern runway when the wind is blowing from the east. The agreement does not suit everyone, but it means that people in the villagewhich is very close to the airport fencedo not have to suffer the dreadful roar of engines when a plane takes off. If the agreement were done away with, life for the people in Cranford ward would be absolutely unbearable. We would have to give them money to movean awful lot of money.
	If the continued expansion of Heathrow is so desperately important for Britain's economy, where would a fourth runway go? I can tell the Secretary of State that no such proposal is going to work. If we are to expand the air transport industry, we will have to look for a site for a new airport, where the noise will not affect people. The industry is very short of sensible, long-term planning, and we cannot trust the people who lead it. They lied during the terminal 5 inquiry, as has been noted in the debate already. I previously always supported expansion at Heathrow. I supported terminal 5 because we needed extra capacity in Heathrow. It is relevant to note that three Members of Parliament who previously supported expansionmy hon. Friend the Member for Brentford and Isleworth, John Wilkinson who was a previous Member for Ruislip-Northwood, and Ichanged our minds. It is significant that people who always supported expansion changed their minds when it came to expanding outside the present boundaries, and I support my hon. Friend the Member for Hayes and Harlington (John McDonnell). It is a desperate situation.
	To return to my constituents, I have mentioned the Cranford agreement, which prevents planes from taking off on the northern runway when the wind is from the east, as the noise is absolutely unbearable. For 13 years, I worked under the flight path half a mile from the touchdown point on the southern runwayhalf a mile from where a plane crash landed a few weeks ago. The mixed mode is absolutely unacceptable; I could read quotes from constituents who say that they cannot enjoy their gardens at all when planes are landing or taking off. That problem extends a long wayto Richmond Park and even further east. If mixed mode comes in, it will be the end of runway alternation. I do not need to explain that to people on the Liberal Democrat Benches; I am sure that the hon. Member for Richmond Park (Susan Kramer) will get her own back on colleagues later this evening. If we bring in mixed mode, thousands of people will never again be able to enjoy their gardens. We are not talking about 1,000 or 2,000 people, but many thousands, and that is not acceptable.
	Let me address the Ministers. I know how the system works. Ministers are suddenly transferred into a new Department. The technology on air transport is not straightforward, but there are civil servants who understand it, and obviously the air transport industry understands it pretty well. People like me are never asked for advice by Ministers. Only one Minister has asked me for advice, despite the fact that I have lived under a flight path for 45 years. I understand the position, and things are very difficult for Ministers. It is difficult to come into a new Department determined to change the policy that is already in place. The Under-Secretary of State for Transport, the hon. Member for Poplar and Canning Town (Jim Fitzpatrick), and the Secretary of State have a chance to show that they have guts and determinationthat they are politicians who will work for the people of the United Kingdom. By that I mean that they will look at the long-term future of air transport. I care about the industry, and so do the people in my constituency who suffer its noise. They care about it because it is they who built up and worked for the industry.

Madam Deputy Speaker: I am afraid that the hon. Gentleman's time is up.

David Wilshire: May I start by declaring some interests? I represent 70,000 people who live right up against the boundary fence of Heathrow, and a work force 26 per cent. of whom depend directly on the airport for their jobs. I represent a constituency in which the majority of residents support another runway, and I represent a borough council that formally supports another runway. Heathrow has serious problems, and those problems are already costing it business and will soon cost us jobs.

Chris Mullin: Am I right in thinking that there is more or less full employment around Heathrow, and therefore that the creation of more jobs is not part of the case for continuous expansion?

David Wilshire: The hon. Gentleman is absolutely right. I have never argued for more jobs at Heathrow; all that I have argued is that there should be no redundancies in Spelthorne. That is the job-related issue that bothers me.
	Before terminal 5 was built, there was a lack of terminal capacity. Heathrow's capacity was 40 million people, but 60 million were using it. HopefullyI stress hopefullyterminal 5, the replacement of terminals 1 and 2 and the renovation of the other terminals will solve the terminal problem, but it will not solve the problem of the lack of runway capacity. Solving the lack of runway capacity at Heathrow is crucial and urgent, and I advance that argument not only for economic reasons. I accept the environmental problems, but there are, curiously, further environmental issues that we should consider.
	For example, another runway would mean that those living under the flight paths of the existing two would have fewer flights overhead. If we end up with mixed mode operationI oppose but fear we will get itanother runway would mean that we could bring back alternation. That would stop fuel being wasted as aircraft queued at the end of runways. It would stop fuel being wasted by aircraft going round and round and round until somebody found them a runway slot. It would stop some minor events, such as bad weather, causing enormous local Heathrow problems, which again, damage the environment.
	Add to that little list the advent of much quieter, far less polluting aircraft and the new rail link, which the Liberal spokesman, the hon. Member for Lewes (Norman Baker), did not seem to know anything about, and we have the beginnings of a casea much lengthier case, which I cannot make in six minutesthat the environmental issues can indeed be overcome.
	I want to discuss for a moment the details of the Liberal Democrats' motion and their spokesman's ill-researched speech. He began by admitting that there is a mistake in his motion, but the mistake is what he will vote for. That is extraordinary. He spoke about alternation, but when challenged he demonstrated that he has no idea what mixed mode and alternation are. He went on to say that transit passengers are irrelevant. That proves that he does not even begin to understand what the significance of a hub airport really is. Without those transit passengers, many long-haul routes at Heathrow, irrespective of which airline operates them, would no longer be viable and the UK would suffer from the lack of international communications through a major hub airport.

Susan Kramer: In relation to a hub airport, will the hon. Gentleman not concede that increasing the number of transit passengers has a diminishing return? The requirement is an adequate number of destinations with an adequate number of flights. An ever-increasing number of destinations with an ever-increasing number of flights brings nothing additional to the economy. That is the point that has been missed in the economics of this farce.

David Wilshire: The hon. Lady fails to point out to the House the fact that the problem is that Heathrow is losing routes. It is a question not of gaining them, but of stopping the haemorrhage and getting back the ones we have lost.
	The hon. Member for Lewes went on to show even more clearly that he did not have the slightest idea what he was talking about when he said that a new high-speed rail link was an effective alternative. In an intervention on the Secretary of State, I rather made the point that the choice of flying to Amsterdam or of catching a train to London and then a tube is a no-contest. People would simply fly somewhere else. High-speed rail is essential for people who want to travel to London from the north, but not if people want to go to Tokyo.
	The Liberal Democrat motion claims that the consultation is deeply flawed. The justification advanced for that is that the Department for Transport has consulted with BAA. I should have thought that we would condemn the Department for not consulting BAA, because when, tragically, there is a crash, I have never yet heard anybody say that the crash inspectors must not consult the airframe and engine manufacturers. It is common sense to talk to those people.

Norman Baker: That is a gross distortion of what I said. I said that there was nothing wrong with BAA talking to the Government and that it was perfectly proper that it did so. My concern was that BAA had influenced the Government to an unnecessary and unhealthy degree.

David Wilshire: I hear what the hon. Gentleman is saying, but I do not have time to get locked into a debate. I will happily answer him afterwards.
	The Liberal Democrat motion claims that the economic case is overstated. It is not. Heathrow is this country's only hub airport. Its continuing success is essential for the future of the British economy and for the UK's ability to compete internationally. It is essential for Heathrow to see off foreign competition. It is essential to safeguard tens of thousands of jobs, many of which are those of my constituents.
	A Labour Member raised the question of a brand new hub airport somewhere else. Yes, if the map was blank, we could have a discussion about whether Heathrow was a sensible place for our hub airport, but we are where we are. If we built a brand new airport somewhere else, the first thing that would happen, as happens at any other new airport, is that people would build houses next to it. It would require the most massive subsidy from public funds. It would result in a huge number of jobs in west London and in my constituency disappearing, even if all they had to do was move across to the Thames estuary. It would lead to a serious loss of foreign business and foreign investment. If the foreign people round Heathrow were forced to go somewhere else, my guess is that they would go to Paris or Frankfurt rather than scuttle out to the Thames estuary.
	My case is simple. Solving the runway problem at Heathrow is essential for my constituency, for the Thames valley, for London and for the whole of the United Kingdom. I beg the House not simply to take my word for it. Listen to the majority of my constituents. Listen to the formal opinion of Spelthorne borough council. Listen to the trade unions, which also want to protect their members' jobs. Listen to local, regional and national businesses, and then listen to the passengers. Heathrow urgently needs another runway, provided we can overcome the environmental problems.

Martin Linton: I am grateful for a six-minute chance to explain my difficulty. I certainly cannot support the Liberal Democrat motion, which is deeply flawed and appears to want to abolish runway alternation or, as the hon. Member for Lewes (Norman Baker) called it, runway alteration, which might be a better idea. I have sympathy with some of the other points, such as keeping the cap on flights at 480,000.
	I could not have supported the Conservative amendment if it had been selected. The Conservatives are deeply divided on the fundamental issues. I also cannot support the Government amendment, because it refers to the economic case for expansion, presupposing that there is an economic case for expansion at Heathrow. The title of the consultation document, Adding capacity at Heathrow airport, also presupposes that the outcome of the consultation will be additional capacity.
	I want the present limit, 480,000 flights, to be maintained. That is about 40 planes an hour. I have confidence that Ministers will approach the consultation with an open mind. I hope that they will have the courage to say no to British Airways and to the British Airports Authority and come up with the answer that I think is the right one, which will not allow any expansion of Heathrow or any added capacity.
	I shall make two short points in my brief contribution. First, I reiterate the point that I made to my right hon. Friend the Secretary of State about the 54 dB contour. People who live within the 57 dB contour suffer far more. I understand the difficulty of the constituents of my hon. Friend the Member for Feltham and Heston (Alan Keen), but they are only tens of thousands. People who live within the 54 dB contour are hundreds of thousands. The end of runway alternation and the imposition of mixed mode would increase the number of people within the 54 dB contour from the present 633,000 to 750,000. That is almost 120,000 more people being subjected to aircraft noise.
	People may think that 54 dB is nothing. I had a public meeting in my constituency with 250 people there complaining about 54 dB noise. I can promise my hon. Friends in the rest of south London that if mixed mode comes in and the 54 dB contour goes right across south London, they will have public meetings full of exactly the same kind of people protesting about the amount of noise above their heads. The maps provided by the Department for Transport show that the 54 dB contour, which currently reaches as far as Battersea, would extend as far as New Cross, so a whole new slice of London will be subjected to it.
	I have taken a group of nine Battersea residents to see my hon. Friend the Member for Poplar and Canning Town (Jim Fitzpatrick), the Minister, who has been understanding and co-operative. I have written to him with the bones of a solution to the problem; it lies in the part of the consultation about westerly preference. It is a huge anomaly that of every 40 aircraft that land at Heathrow every average hour, 30 land over London and only 10 land going east. Almost all those 10 land over Windsor rather than the southern runway.
	There is a flight path into Heathrow that crosses Windsor great park, reservoirs and farm land; hardly anybody lives under it at all. An aircraft using that path to land would disturb only deer, fish and cattle. There is only one village under that flight path and it has a population of 1,609. I am not saying that it should get something that we do not get, but if there were fairness and equal numbers landed from each direction, that would be a huge improvement for the long-suffering residents of south London. I am advocating not that that village should bear the brunt of the noise, but that there should be a fair share through the ending of unnecessary westerly preference.
	There is a huge snag, which is the Cranford agreement; I have every sympathy with my hon. Friend the Member for Feltham and Heston (Alan Keen), in whose constituency there is a small pocket of streets right up against the fence near the northern runway. Clearly, people living in them should not be subjected to aircraft taking off above their heads. As my hon. Friend said, the answer is money for them to move. That would unlock the potential for aircraft to land at Heathrow going east and save a huge amount of disturbance.

Alan Keen: I did not say that those people should be given money to move. They do not want to move; they work at Heathrow airport and are proud of it.

Martin Linton: There should be compensation of some kind because unnecessary agony and pain is put on residents around Heathrow because of this problem. I could go on to talk about the longer-term problems of Heathrow. No other capital city in western Europe has an airport situated to its west, with the prevailing winds implying that practically every aircraft has to land across the capital. However, that is a long-term problem.
	As far as this consultation goes, there is every possibility of finding a way through the problems and reducingnot just cappingthe impact on the whole of south-west London of noise from aircraft landing. I look forward to the Minister's finding a way to announce such a measure in respect of the consultation.

Susan Kramer: I am very conscious of the time available and the number of people who want to speak, so I shall take as read my very strong views on a lot of issuesclimate change, the negative impact of the third runway, the damage to Sipson, the impact on schools, learning, air quality and traffic congestion, and the huge potential loss for the air-rail hub at Heathrow.
	I shall also say little about the quality of the consultation, but it so offended my constituents that Richmond council put out its own survey that had almost 10,000 responses, of which 90 per cent. opposed expansion. That gives an idea of the strength of feeling locally. Furthermore, we did our own little survey, to which there have been 850 responses. Having tabulated the first 450 of them, we know that 99 per cent. of those oppose expansion at the airport.
	Noise is the issue mentioned over and overpeople who cannot have weddings outside or sit in their gardens whenever aircraft are overhead. There was a wonderful little letter from a certain young William, who cannot hear Thomas the Tank Engine. The impact on kids and families is very significant. The very thought that we would end up with mixed mode makes life unbearable; a phenomenal number of people in my area have said that they would simply have to move.
	I want to focus on what seems to be the heart of the Government's argument: their economic case, which I find very specious. Listening to those arguments is like listening to the people who argued once upon a time that the way to develop London's economy was to bring motorways criss-crossing through the city to meet the demand for cars. It is exactly the same now with air travel. Of course Heathrow is a hub airport but, as I said earlier, the point about hub airports is that constantly expanding them has diminishing returns. It is attractive to the aviation industry to bring more transfer passengers into HeathrowBA and BAA love that, because it serves their narrow business interests extremely well.
	The former chief executive of BAA, Stephen Nelson, said that he thought that 35 per cent. of the expanded number of passengers would be transfer traffic. All continental airports compete for transfer traffic, not destination traffic. Having additional flights to more destinations when all the key destinations are already being served to virtual saturation point brings very little economic benefit. The Government have not absorbed that, and Heathrow is the obvious example. As the Secretary of State said, the number of destinations served at Heathrow has dropped by almost a fifth over the past few years. Passenger numbers have stayed steady and London has gone through its strongest period of economic growth, with more companies coming to London and this area than ever before. There is a complete disconnect in the thinking.
	The very complex booklet on UK air passenger demand that has been part of the consultation is conceptually utterly naive, looking merely at a linear relationship between the number of passengers and gross domestic product. It is mathematically complex but has very little understanding of actual behaviour and economic drivers and of the fact that here in London business is changing. Business people do not want to be put on a flight every 10 minutes by their employersthey used to accept that, but no longer. Businesses are trying to reduce their carbon footprint. New technologies are coming through for video conferencing and other ways of communication. High-speed rail is increasingly a preferred option. We are in a period of dynamism and change, and the Government are clinging to an old technology and an old strategy just when they need not do so. The logic of what they say is that we must constantly grow and grow. If there are six new runways in Beijing, then my goodness, we must have more runways here in London. That is utterly unsustainable. If we say that at some point we must draw a line in the sand, let us draw it now before we do additional damage to London's economy and quality of life.
	What brings people to this city is in large part the quality of life that is on offer. Expansion means that parts of London and the south-east that have never been affected by noise will be greatly affected by it, including the City and Canary Wharf and, may I say, Kensington and Chelsea. The minute the spouse of a major executive of an American bank says, I'm damned if I'm going to go and live in that city, because it's bloody unbearable, is the point at which the economic change begins to be delivered in London and we start to lose out. Anyone who thinks that the number of destinations is key should take a look at Frankfurt. It has the most destinations of any of the cities in Europe, but it is not attracting businesses from the UK or anywhere else because people do not want to live there. That is the important underlying issue.
	In my last seconds, I say to the Conservatives that this is the day when they must stand up for stopping this expansion now and for ever. Never mind the typothis is the day to show true colours, stand together and bring an end to this absolutely idiotic plan to expand capacity at Heathrow.

John McDonnell: I abhor the nature of this debate. I am unhappy that it has become party political knockabout.  [ Interruption. ] I am not being pompous. This issue is too important to most of us. To be frank, all those of us opposed to a third runway should have got together and even helped to draft the motion.
	For many people out there, the message that comes across loudly is that this place is becoming good enough only for climbing on the roof and hanging their banners, and useful for nothing else. Many people think that the third runway is already going ahead because the Government have made up their mind about it. We cannot blame them for that. As my hon. Friend the Member for Feltham and Heston (Alan Keen) said, they have been lied to and deceived for decades. On the fourth terminal, they were told there would be no further expansion by a Conservative Government; on the fifth terminal, an inspector says no, and BAA writes a letter to promise no further expansion; and a Labour Government then cap that, but within six months the cap is under contest.
	Even during the current process, the White Paper referred to a third runway, but did not mention a sixth terminal in any detail. It referred to one village, but it is not just oneas has been said, more than six are involved, including Harmondsworth, Harlington, Longford and Cranford Cross. First of all it was said that just under 100 homes were at risk, but we then learned that it was to be 700, affecting 1,000 people. We then discover that it is actually 4,000 homes and 10,000 people. We are told that an objective analysis has gone on and that detailed discussion has taken place based on the free flow of information. It has not. I pay tribute to the hon. Member for Putney (Justine Greening) for the work that she has done under the Freedom of Information Act to extract information.
	All the way through this process, people believed that the Government sought to deceive them because they had already made up their mind. The consultation process has been a farce. The exhibitions have been meaningless and the distribution of materials has been chaotic. I say to the Under-Secretary of State for Transport, my hon. Friend the Member for Poplar and Canning Town (Jim Fitzpatrick), that it is unacceptable for the Secretary of State not to come to my constituency and meet people who will lose their homes when she has taken the time to visit Heathrow airport to meet aviation companies instead. That does not respect the standards of decency of any Government whatever.
	As far as the discussions on collateral costs are concerned, there has been no planning and no meetings with any authority, or any of us, about what will happen to our constituents if they are forced out of their homes. Let us remember that three schools, a community centre and a hospice are affected, and now we have discovered that the road network goes through the cemetery in my local communityCherry lane cemetery, in which we are still burying our dead. That is what is happening at the moment.
	There has been no financial analysis. During the discussions on the original White Paper we were told that alternatives were looked at. They were not looked at in any detail and my right hon. Friend the Member for Greenwich and Woolwich (Mr. Raynsford) raised the point that there had been inadequate discussion about alternative sites. There was inadequate discussion about rail alternatives. Today, HACAN ClearSkies has submitted a letter to my hon. Friend the Under-Secretary outlining the options available to relieve Heathrow through further rail investment.
	As far as economic analysis is concerned, we have not been told what the overall costs will be and what the burden will be on the public exchequer. We all know about the state of Ferrovial and the high leverage buy-out it made of BAA. Even given the increase in landing charges allowed by the CAA recently, we know about the financial problems that that company has, and we know that it is running into difficulties in other deals. I say to my hon. Friends that I resent paying public money to subsidise the profits of a company that was founded by a fascist who made his money out of his relationship with Franco and his dealings behind the scenes through Opus Dei.

Madam Deputy Speaker: Order. The hon. Gentleman will withdraw those remarks.

John McDonnell: I beg your pardon, Madam Deputy Speaker, but I am referring to the company, which was founded by a fascist who had a relationship with Franco. That is who I condemn. If that is out of order, please advise me.

Madam Deputy Speaker: I understand. You are saying the company; I thought that you were referring to an individual.

John McDonnell: Can I just explain, then, that the individual was a fascist? He fought on the side of the fascists against the republicans in the civil war. He made his profits as a result of his relationship with Franco. I understand if there has been a misinterpretation.
	I return to the point that people out there feel that the decision has already been made. I shall give some examples. People have referred to the fact that the Prime Minister, when Chancellor, made statements in favour of the expansion of Heathrow. He has also made such statements as Prime Minister. We had the gaffe on Monday on terminal 5, when my hon. Friend the Under-Secretary referred to the consultation and said:
	We are confident that, when we analyse the consultationwhich, as the hon. Lady knows, is being undertaken at presentand publish our findings in the summer, our validation will be proved to be correct.[ Official Report, 31 March 2008; Vol. 474, c. 434.]
	Three minutes later, he is passed a note by the lawyers, and has to correct the statement.
	I also refer hon. Members to what has happened in my own borough. The London borough of Hillingdon received a notice from the planning inspectorate and the Department saying that it had to amend its local planning framework to take into account a third runway and a sixth terminal, pre-empting the consultation on the development of the framework.
	I refer to what happened to the Mayor of London, whom one of my constituents contacted because he came out against the expansion and the third runwayas have all the other candidates, on which I congratulate them. My constituent wrote to ask the Mayor why he had not included his opposition in his development plan. We received the following response:
	When the Authority published the proposed alterations to the London Plan for public consultation in... 2006, they set out firm opposition to expansion... ('additional runway capacity at Heathrow is therefore opposed'). However, the Government objected to this wording and asked that these words be removed. The Plan cannot be published without Government approval and the Authority has therefore reluctantly agreed to delete these words so that Government would allow the plan to be published.
	That is why people outside believe that the decision has already been made. The Government have fixed the White Paper and the consultation process. They are bullying local authorities and even the Mayor of London to try to undermine the opposition throughout our communities, and, thereby, the decision-making process of the House.
	I therefore demand that the matter be brought to the Chamber for decision.

Justine Greening: I am pleased finally to be able to contribute to the debate. All I ever wanted was to have a fact-based discussion about the right decision on the matter.
	The issue is clearly important in Putney, Roehampton and Southfields. We are especially concerned about the proposals for runway alternation. The current half day of respite that we get from aircraft noise is massively valued. Families live in my area and love the open space and all-day flights would fundamentally undermine our quality of life. When we held a public meeting to consider the proposed expansion, more than 700 people turned up at St. Mary's church in Putney. There were not more only because the church was full. We had to hold a public meeting because, in spite of a direct promise from the former Minister with responsibility for aviation in 2006 to hold a public exhibition in my constituency and in the borough of Wandsworth, it did not happen. Since I became a Member of Parliament and before that, I have emphasised that aircraft noise is a genuine problem.
	We know that all-day noise will have an impact on not only residents but our local children. I am a governor at Hotham primary school in Putney, and it will be affected, as well as All Saints and Brandlehow schools. Those children's education will be fundamentally disrupted by the all-day noise overhead.
	I am disappointed and frustrated that the Liberal Democrat motion has not been designed to gain broad support in the House. Obviously, it contains a glaring error and a mistake about runway alternation. I also believe that it is in error because it does not call on the Government to get rid of mixed mode as well as the proposal for a third runway. I cannot support it because having all-day flights over Putney would put my constituents at risk, and that would be wrong.

Susan Kramer: Will the hon. Lady give way?

Justine Greening: I am afraid that I do not have much time. I understand the concerns of the Liberal Democrats, and our amendment states that the expansion proposal cannot and should not go ahead.
	The freedom of information results that I have obtained clearly show that BAA was so involved with modelling the air pollution and noise that there was a BAA forecasting team. BAA also sat on the Heathrow project board. I do not remember being invited to sit on that board as a key stakeholder and local Member of Parliament. That applies to hon. Members of all parties. BAA was involved in writing the consultation document and was actively asked for input. Meeting minutes show that it was not only asked to do that but that, a couple of months later, it provided some input, which has been incorporated.
	BAA was involved with the Department for Transport in developing joint lines to take to deal with media and press inquiriesand, no doubt, Members from the south and their constituents. That is fundamentally wrong. BAA had to seek out and employ WS Atkins to conduct part of the peer review. Again, that is wrong and gives an impression of a review of whether the environmental tests could be overcome that is led not by the Department for Transport but by BAA. The Secretary of State shakes her head, but that is exactly how the minutes come across.
	As I said in my intervention on the Secretary of State, if she is so happy that the environmental case has been made, why will she not release the detailed data, after nearly a year of my trying to obtain them through every possible method? Why do the minutes say that the fleet mix used to estimate noise and air pollution was still being modified right into September last year, just weeks before the consultation?
	I have notes in which BAA is asked by the Department for Transport to redo the modelling. Those notes say:
	Given the urgent timetable to which my colleagues on the Heathrow team are working, would it be possible for you to provide the required tables by the end of this week please?
	That does not sound like a DFT-led proposal. Interestingly, the people at BAA said in response that they were concerned that the re-forecasting scenarios
	would not provide you with data which is sufficiently robust to be cited in the consultation document.
	I do not have e-mails from after that, however, so I do not know what eventual decision was taken, but I know that BAA was heavily involved, to an inappropriate extent.
	I will wrap up. We have talked about the fact that CO2 emissions have not been properly accounted for. It is ridiculous for the Secretary of State to say that half the flights should have been excluded. How to use the Shadow Price of Carbon in policy appraisal, a document issued by the Department for Environment, Food and Rural Affairs, says that the impact on greenhouse gas emissions
	should be net change from an assumed baseline rate of emissions. The assumed baseline are emissions in the absence of the policy.
	There would be 220,000 fewer plane movements every year in the absence of the policy, yet they have not been included at all.
	The reality is that the consultation has been a sham. It has let Londoners down and shown that the Government are out of touch. It is absolutely right that we are tabling a motion to say

Mr. Speaker: Order. I call Mr. Meacher.

Michael Meacher: I am not a local MP to Heathrow, unlike others in the Chamber tonight, but I have a strong interest in two aspects of the debate. The first is the evidential basis for the forecast of air quality and noise impacts, and the second is the status and weightor perhaps the lack of themgiven to climate change considerations in the final judgment.
	On the first issue, the conclusion reachedthat one can bolt a new airport the size of Gatwick on to Heathrow without any adverse environmental impactsnever commanded any credibility and, frankly, has attracted a great deal of derision. However, what was so disturbing about the story in  The Sunday Times on 9 March is the exposureuncovered by the excellent work of the hon. Member for Putney (Justine Greening)of just how deceptive and manipulative Departments can be in pursuit of a pre-determined objective.
	The documents show that BAA gave directions to Department for Transport officials on how to strip out data in the consultative document that showed that the expansion would cause unlawful levels of pollution and extra noise. The documents show that BAA repeatedly selected alternative data for the consultation, which were devised in order to secure the result that showed an insignificant impact on noise and pollution. The documents show that the Department for Transport apparently gave unprecedented access to confidential papers and allowed the company to help to rewrite the final document.
	The documents also show that the final document significantly reduced the likely greenhouse gas emissions of the third runway, by excluding incoming international flights. We also know that one official closely involved in Project Heathrow, which researched the environmental impacts of the runway, said:
	It's a classic case of reverse engineering. They knew exactly what results they wanted and fixed the inputs to get there. It's appalling.
	If all that is trueI am not aware that any of it has been deniedit indicates that a line has been crossed that is not acceptable. The era of spin and manipulation in this country has done untold damage to our political culture. Politics in this country will not recover until people are confident that they are being given the truth, however hard the truth is, and that it is not simply being massaged in order to suit the interests of the powers that be.
	I say all that much more in sorrow than in anger, but certain implications follow from it. Frankly, the consultative document should be withdrawn and replaced by a much more honest and accurate one, before it is legally challenged in court, which I expect it will be, and before a judge requires it to be withdrawn.
	I think that there must be accountability for such behaviour. I assume that no Minister was directly involved in the massaging of these data, but I believe that leading civil servantsincluding, as has been mentioned, David Gray, who appears in all the documentsshould be disciplined and, if necessary, removed, which is what I believe would occur in any other sector of employment.
	It pains me to agree with the Opposition motion, but I believe that the Government have got to stop going through the motions of consultation, when it is clear to everyone that they have already made up their minds. It happened with GM foods; it happened with nuclear power; it happened with Trident; and now it is happening with the third runway. The Government should listen more to the voices of the peoplein this case, the long-suffering and much put-upon people of west Londonand listen less exclusively to the big financial and industrial barons. I simply say that what is good for BA and BAA is not necessarily good for the UK.

David Wilshire: rose

Michael Meacher: I have no time.
	The second fundamental issue that I wish to addressin a minute and a half, or, actually, even less [Interruption.] I wanted to talk about the relationship between aviation and climate change, but I shall save that for a future occasion.

Steve Webb: I shall start by picking up where the right hon. Member for Oldham, West and Royton (Mr. Meacher) left off, as the link between aviation and climate change provides the context for this debate. The right hon. Gentleman will know that only last November the Department for Transport projected emissions growth from aviation. It said that, even taking account of the radiative forcing effects, 9 per cent. of our current emissions come from aviation; by 2020 it will rise to 15 per cent.; and by 2050, 29 per cent. That means huge potential growth in the emissions from aviation, and here we are looking at expanding a major airport. The two simply do not sit together, and if we are serious about tackling climate change, we have to say no to the third runway at Heathrow.
	This has been a debate of contrasts. We have had some very clear contributions, and it is noticeable that all four Back-Bench contributions from Labour Members were opposed to the Government's position. The hon. Member for Feltham and Heston (Alan Keen) provided a knowledgeable and passionate defence of his constituents and their interests; the hon. Member for Battersea (Martin Linton), who is no longer in his place, raised the issue of those just below the top decibel threshold and the many more who will be affected by the noise impact of Heathrow; the hon. Member for Hayes and Harlington (John McDonnell) talked about the growth in promises, and the dodgy consultations that we have already seen on nuclear power and we are seeing now with Heathrow; and the right hon. Member for Oldham, West and Royton highlighted, as have others, the role of BAA in all this. No one doubts that it has to supply information; no one doubts that it is an interested party, but it has to be open and transparent.
	I echo the tributes paid to the hon. Member for Putney (Justine Greening) for her perseverance, which should not have been necessary. The information should have been in the public domain. If the Government have nothing to hide, why will they not [Interruption.] The Secretary of State says It is from a sedentary position, but I strongly suspect that there is a long list of information that the hon. Member for Putney has requested that has not been put in the public domainenvironmental information, for example, which needs to be in the public domain now.
	Before moving on, I should also pay tribute to my hon. Friend the Member for Richmond Park (Susan Kramer), who has been absolutely unambiguous about her position on the third runway and has been a doughty campaigner. The contrast between her position and that of the official Opposition could not be more acute. The House has the right to know the position of each of the major parties. The Secretary of State is clearly pro a third runway, as she said earlier that there is a clear need for extra runway capacity at Heathrow. She did not say that it was subject to anything. The record will show that she said that [Interruption.] The Minister may wish to qualify it, but that is what the Secretary of State said.
	In contrast, the shadow Transport Secretary said that there were four tests, but the implication of that for another runway is that if the tests are passed, the runway goes ahead. When I intervened to ask her whether the runway would go ahead if the tests were passed, she said something to the effect that the tests were not being passed and it was all very difficult. But it is not very difficult. Either the runway should or should not go ahead or it is conditional on passing the tests. If the Conservatives are saying that it should go ahead subject to the passing of those tests, they should make that clear to the voters of London. The Conservative leader sent an e-mail to a constituent of my hon. Friend the Member for Richmond Park on that very issue. One gets a slight sense that the Conservativesthough it pains me to use the expressionsay one thing to one set of people and something else to another set of people [Interruption.]

Several hon. Members: rose

Steve Webb: The leader of the Conservative party said in an e-mail:
	The economic case for expanding Heathrow is now stronger than for expanding any other airport in the South East.
	That is one of the official Conservative positions.

Theresa Villiers: Does that mean that the hon. Gentleman supports the building of another runway at Stansted?

Steve Webb: No, we do not support that.
	Where do we go from here? I shadow the Secretary of State for Environment, Food and Rural Affairs, who said on 13 March that
	aviation emissions in Europe will be capped at the 2004 to 2006 level.[ Official Report, 13 March 2008; Vol. 473, c. 406.]
	To be fair to the Ministers who are here tonight, that is not what they are saying. They are saying that the aviation industry will just buy carbon emissions above the cap.
	The Government are trying to give the impression that extra runway capacity at Heathrow does not matter because the emissions are capped, but of course they are not capped. All that will happen is that the aviation industry will buy carbon credits from other sectors of the economy. If Heathrow is allowed to expand and aviation expansion goes ahead, other sectors of the economy will not just have to meet the carbon reduction targets that we think they should meet anyway but will have to go even further, which means that the British industry will have to go even further and householders will have to go even further. Why should constant attempts be made to satiate what my hon. Friend the Member for Lewes (Norman Baker) rightly described as the insatiable appetite of the aviation industry?

John Randall: Could the hon. Gentleman explain again why his party thinks it is such a great idea to end runway alternation?

Steve Webb: For the avoidance of doubt, the Liberal Democrats oppose the ending of runway alternation.  [Interruption.] That is absolutely clear. Anyone who reads the motion as a whole can be in no doubt about that.
	In the few minutes remaining to me, let me pose this question: what is the alternative strategy? At the beginning of her speech, the Secretary of State criticised us for suggesting that not everyone should be able to go on every holiday they want, and that not every business should be able to take every business flight. She criticised us for suggesting that there should be constraint. She also said, however, that she did not favour predict and provide, and that the growth would be less than the predicted demand.
	There is no difference between our position and the Government'swe both accept that the growth of airport traffic will be rationedbut, as was pointed out by my hon. Friend the Member for Lewes, the Liberal Democrats have stated explicitly that that should involve substituting high-speed rail for air travel, which is far more relevant, and also demand management, which means raising the cost of flying through carbon taxation and rationing. If the Government are serious about meeting their carbon emission targets, they must accept the need for measures of that kind.
	The Climate Change Bill, to which reference has been made, does not even mention aviation. It is not included in the targets. Only carbon dioxide emissions are capped by the trading scheme; other aviation emissions are not capped in the same way. It is not the case that there is no problem with emissions as a result of airport expansion. It is clear that there is a problem, even given the trading scheme. The next phase, which applies to aviation, will not be introduced until three or four years from now, and in the meantime the emissions will continue to increase. That is the key point.
	As we have heard from Members representing constituencies in the area, this is predominantly a local issue, but it is also a national and a global issue. Important issues have been raised by Members such as my hon. Friend the Member for Richmond Park, but we are in danger of losing sight of the bigger picture: the soaring contribution of aviation emissions to climate change.
	One of the problems with tackling climate change is that the Department for Environment, Food and Rural Affairs does not control transport policy, so Heathrow gets expanded. It does not control energy policy, so we get new coal-fired power stations. It does not control the rules on new houses, so no effective action is taken on emissions from housing. Regrettably, we have a weak Department responsible for the environment and a powerful Transport Department, with powerful friends alongside it, shaping the consultation. That is why, on an environmental basis and on a transport basis, this is a fundamentally flawed prospectus.
	To conclude, there have been two clear positions in this debate: that of the Liberal Democrats, who oppose the third runway at Heathrow, and that of the Government, who have clearly made up their mind already. What we have had from the Conservatives is fudge and bluster, and the electorate will find them out.

Jim Fitzpatrick: This has rightly been another lively debate on the issue of Heathrow. That reflects the importance not only of the airport to the economy and as the UK's aviation hub, but of the need to balance that with proper concern for the environment.
	Before trying to address some of the points that Members have made, I would like to comment on the recent consultation exercise. Several Members criticised the Adding capacity at Heathrow airport consultation. By any standards, it has been a major democratic exercise: summary documents were mailed to more than 217,000 households; consultation documents were sent to more than 700 stakeholder organisations; it was widely publicised, in both the national and local media and elsewhere; 13 public exhibitions were held in communities around the airport and in central London; the consultation materials were available on request and online; and a dedicated call centre was in operation throughout. Almost 5,000 people visited the exhibitions, and we have received more than 70,000 responses. That explains why the consultation has met, and in some aspects exceeded, the Cabinet Office guidance on the conduct of such exercises.
	The lengths to which we have gone to inform the public and others about our proposals is a clear statement of our determination to ensure that final policy decisions are fully informed by the views of as many stakeholders as possible. So despite the criticisms of some, I am firmly of the view that this consultationalbeit on a subject that many feel passionately abouthas been conducted in an exemplary manner.

John Randall: Will the hon. Gentleman give way?

Jim Fitzpatrick: Against my better instincts, so as not to run the risk of appearing rude I shall give way to the hon. Gentleman.

John Randall: The hon. Gentleman is always very courteous. Can he tell me why I did not receive a consultation document when I was only four miles way, whereas people in west Londonmiles and miles awaydid?

Jim Fitzpatrick: I knew I should have listened to my instincts and not given way to the hon. Gentleman. He was fully aware that the consultation was taking place, and he could have downloaded the document. As I have said, it was sent to 217,000 households.
	The analysis of the consultation responses will be used to inform final policy decisions on a third runway, on mixed mode, and on other operational procedures. As the House will appreciate, until this analysis has been completed it would be premature for Ministers to comment on the outcomes. What I can say is that we expect to make final policy decisions later this year.
	The hon. Members for Lewes (Norman Baker) and for Chipping Barnet (Mrs. Villiers) made accusations of collusion, which we refute entirely. We refute the accusations that the Department has behaved improperly in its relations with BAA plc and in managing the consultation exercise.
	The 2003 air transport White Paper made it absolutely clear that we expected the aircraft operator, working with the Civil Aviation Authority, NATS and the Government, to develop proposals to form the basis of consultation. It would not have been sensible, or indeed possible, to attempt this work without the technical and operational expertise of the operator.
	I must also say that it is outrageous of my right hon. Friend the Member for Oldham, West and Royton (Mr. Meacher) to suggest that civil servants should be disciplined on the basis of an article in a newspaper.

Norman Baker: The article in  The Sunday Times is important, as Members of different parties have raised it this afternoon. Does the Minister believe there are factual inaccuracies in that report, and if so, what are they?

Jim Fitzpatrick: I do not have time to go into the detail of the factual inaccuracies in the report in  The Sunday Times. What I can say is that we refute the allegations of collusion, and that we stand by the information, the evidence and the data we published in our consultation material, which is edited by, and under the control of, the Department for Transport. I have faith in the professionalism and integrity of the officials at the Department for Transport.
	The hon. Member for Lewes raised the issue of airspace availability to support expansion and my response to him at Transport questions. As he knows, safety is the Government's top priority. The Department for Transport has worked with both the CAA and NATS to ensure that proposals for a third runway at Heathrow are fully workable.
	NATS has undertaken a feasibility studyI acknowledge that the hon. Member for Lewes has received a letter, but if I could explain the information that I have, perhaps we could compare notes afterwards outsideon the airspace for a third runway and mixed mode. We have published reports for both, along with the consultation document, that show that an expanded airport is operationally feasible in air traffic control terms. Naturally, further detailed work would need to be done if the proposals are taken forward, and consultation would need to take place on final designs under established CAA procedures.
	The hon. Member for Putney (Justine Greening) has been raising the question of the release of the environmental data. We originally withheld partial and preliminary results ahead of the consultation, as we are permitted to do under freedom of information legislation. We have published the finished material in depth, in the consultation and the supporting documentation, and it is on the Department for Transport website.
	My hon. Friend the Member for Feltham and Heston (Alan Keen) raised the question of Cranford. The Cranford agreement was introduced when the noise from departing aircraft was significantly higher than it is now. Although it benefits some residents, it is disadvantageous to other communities around Heathrow. The consultation asks for views on whether that is equitable.
	I find it staggering that the Liberal Democrats intend to press their motion to a Division even though it has a word missing. That is the type of error that we would not expect from a sixth-form debating society. Forgive me; I am not comparing the Liberal Democrats to a sixth-form debating society, as to do so would be to demean sixth-form debating societies. With the greatest respect to the hon. Member for Lewes and colleagues, the words on the Order Paper are not what they meant to say and if they had any integrity they would not press the motion to a vote. They have had their say and stated their position, and they should withdraw the motion when they get the opportunity to do so at the end of the debate, rather than pressing a flawed motion to a vote.
	I hope that the hon. Member for Lewes does withdraw the motion, because in my view, and that of the Department for Transport, it shows that the Liberal Democrats are in denial. The motion does not seem to acknowledge that aviation is growing, has been growing and will continue to grow. We must balance our need to provide for that expansion while addressing the challenge of climate change. We have clearly outlined our support for benchmarking emissions at 2004 to 2006 averages, and we have been leading internationally on aviation being incorporated into the emissions trading scheme. Responsible policies are the way forward. We do not have to choose between being rich and dirty or poor and green. The Government have set out their climate change strategy and the Department for Transport has published our policy document Towards a Sustainable Transport System.
	On the contribution by the hon. Member for Chipping Barnet, I must tell many of her colleagues that although she may not be persuaded that the case has been made for a third runway, the business community has not just been persuadedit has been actively lobbying for it through most of its organisations. No one is saying that these are easy decisions, but they are important and they are in the wider economic national interest. I suspect that, to a certain extent, the Conservative amendment is partly about getting the name of the hon. Member for Henley (Mr. Johnson) on today's Order Paper, as much as anything else for the sake of the London elections.
	In conclusion, the Liberal Democrat motion is plain wrong. It is wrong in its wording, wrong in respect of what is happening in the real world of aviation, wrong in attacking this Government's international efforts to tackle climate change and wrong in its basic conclusion that we can ignore the capacity constraints at Heathrow. In contrast, the amendment standing in the names of the Prime Minister, our right hon. Friends and myself restates how we will address the issue of emissions and climate change, acknowledges the economic importance of Heathrow and refers to the consultation exercise and how we will take this issue forward.
	I commend the amendment to the House and ask the hon. Member for Lewes to withdraw his motion. If he does not do so, I ask the House to vote for our amendment and against the motion, which he and his colleagues have accepted is flawed, wrongly worded and does not say what they want it to say.

Question put, That the original words stand part of the Question:
	 The House divided: Ayes 66, Noes 265.

Question accordingly negatived.
	 Question, That the proposed words be there added,  put forthwith,  pursuant to Standing Order No . 31 ( Q uestions on  amendments):
	 The House divided: Ayes 257, Noes 193.

Question accordingly agreed to.
	Madam Deputy Speaker  forthwith declared the main Question, as amended, to be agreed to.
	 Resolved,
	That this House recognises that the Government's policy on airport expansion is consistent with its long term, balanced and sustainable aviation strategy as set out in the 2003 White Paper The Future of Air Transport, that its support for emissions trading represents the most effective way of tackling climate change concerns, that the Adding Capacity at Heathrow Airport consultation is a robust document that is the product of a lengthy period of comprehensive analysis, that the consultation process followed best practice as set out by the Cabinet Office, that the economic case for the expansion of Heathrow Airport, as set out in the consultation, accurately reflects the Government's current understanding of all the relevant costs and benefits, and that Ministers should base their forthcoming decisions on the future of Heathrow on all the evidence available, including the responses to the consultation.

DELEGATED LEGISLATION

Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Delegated Legislation Committees),

Immigration

That the draft Immigration (Registration Card) Order 2008, which was laid before this House on 5th March, be approved. [Mr. Michael Foster.]
	 Question agreed to.

PETITIONS

Post Office Closures (Kent)

David Evennett: I have pleasure in presenting a petition signed by more than 2,000 of my constituents. They are angered and concerned that their local Brampton road sub-post office is faced with closure, and they urge Post Office management to think again.
	The petition states:
	The Petition of those concerned about the proposed closure of Brampton Road Post Office,
	Declares that Brampton Road Post Office should remain open.
	The Petitioners therefore request that the House of Commons urges the Secretary of State for Business, Enterprise and Regulatory Reform to call upon Post Office Ltd to abandon its plans to close the Post Office at 301-303 Brampton Road.
	And the Petitioners remain, etc.
	[P000162]

Alderman Blaxill School

Bob Russell: I present the petition of Kevin Starling, Lyn Barton, Nigel Offen and pupils and former pupils of Alderman Blaxill school, Colchester, together with parents, residents and others. There are nearly 500 signatures on the petition objecting to the closure of Alderman Blaxill school and of Thomas Lord Audley school at Monkwick and the construction of an academy on the Monkwick site.
	The petition states:
	The Petition of Kevin Starling, Lyn Barton and Nigel Offen - and pupils and former pupils of Alderman Blaxill School, Colchester, together with parents, residents and others,
	Declares that the school has a special place in the life of the Shrub End community in accordance with the Government's policies towards promoting sustainable communities; consider that its position as the town's smallest secondary school should be regarded as a positive reason for its retention rather than a reason for closure or merger; stresses in particular the important role the school has with its special relationship with the Colchester Garrison and the teaching of pupils whose parents serve in HM Armed Forces; and point out that the school is the only one in Colchester with a unit specialising in dyslexia.
	The Petitioners therefore request that the House of Commons call on the Government to (a) stop Essex County Council from closing or merging Alderman Blaxill School and (b) to ensure that all necessary support, financial and otherwise, is given to enable the school to improve its performance and to continue to be an integral part of the community in the years ahead.
	And the Petitioners remain, etc.
	[P000166]

Post Office Closures (Surrey)

Tom Brake: About three years ago Carshalton and Wallington suffered post office closures in Banstead road, Westmead road, Stanley Park road and Plough lane, to name but a few. Now a further round of closures is threatened, with disastrous consequences. Local people are up in arms.
	The petition states:
	The Petition of Carshalton and Wallington residents,
	Declares their opposition to the Government's programme of Post Office closures, in particular the proposed closure of Post Offices at Seymour Rd, Bishopsford Road, Wrythe Lane, Carshalton Road, and Gander Green Lane.
	The Petitioners therefore request that the House of Commons urges the Government to find alternative business for Post Offices to enable them to continue providing an invaluable service to residents, particularly those who are elderly or have a disability.
	And the Petitioners remain, etc.
	[P000165]

Planning and Development (Reading)

Martin Salter: I wish to present a 1,500-signature petition calling on the Minister with responsibility for planning to delete the Kennet meadows in Southcote, Colney park, Calcott and Katesgrove from the draft south-east plan. That is the area covered by the Prudential proposals to build 7,500 homes on the functional floodplain of the River Kennet in south-west Reading, plans that were described by the Environment Agency as putting the whole of Reading town centre at risk of flooding.
	The petition states:
	The Petition of people from the greater Reading area,
	Declares that the panel looking at the South East Plan were wrong to recommend development of 7500 houses north of the M4 at Reading; this area is in a functional floodplain; the Environment Agency have said that building in this area could result in floods in central Reading; the petitioners wish to see Kennet floodplain protected in line with existing planning policies.
	The Petitioners therefore request that the House of Commons urges the Minister for Planning to delete Kennet Meadow as a development area from the Regional Plan.
	And the Petitioners remain, etc.
	[P000169]

Biosimilar Medicines

Motion made, and Question proposed, That this House do now adjourn. [Mr. Michael Foster.]

Brian Iddon: When a patent runs out on a parent conventional medicine, any other company can start to produce and distribute it as a so-called generic medicine or drug. A drug is the active constituent of a medicine. Generic prescribing is encouraged by the national health service because, in general, generic drugs are substantially cheaper than the originally marketed parent drug. That is because companies that market generic drugs do not have to conduct the research that led to the discovery of the parent drug, thus avoiding expensive clinical trials to establish its safety and efficacy in human use.
	Today, more than 200 drugs are produced by the biotechnology industry, in living cells or in reaction vessels using gene technology, to treat various cancers, AIDS, neurological disorders, heart disease, diabetes and rare genetic diseases. Those so-called biopharmaceuticals, or biological drugs, benefit about 325 million people worldwide. The biopharmaceutical industry is an essential component of the British biotechnology industry in general. So far, the patents have run out on five of the parent branded biological drugs, but that number will increase significantly in the next few years.
	Whereas generic copies of branded conventional drugs, prepared by conventional chemical synthesis, are relatively easy to produce and purify for human consumption, the same is not true for biological drugs, which are extremely complicated chemical molecules compared with most conventional drugs, and are mainly of protein origin. Proteins are very large molecules. They can kink, fold up and even get twisted, which can result in what can be compared with a tangled ball of wool, containing cavities in which other, smaller molecules can sit. There can be interactions between the different parts of those complex protein molecules that can facilitate this tangling of the complex molecule and even interactions between one tangled molecule and another.
	When another biotechnology company produces one of those biological drugs, using a process different from that used by the company that discovered the parent drugand invariably using a different cell linethe resulting tangled molecule will not be quite the same as the parent one. Thus, copies of biological drugs are not identical to the parent drug and are called biosimilars. For their use as drugs, we have to be sure that biosimilar drugs are as close in structure to the parent drug as possible. Otherwise their clinical profile, including safety and efficacy, will be different.
	A particular characteristic of proteins is their ability to produce antibodies and a possible immune response. The time of onset of antibodies is months rather than days or weeksnormally between nine and 14 months for an erythropoietin, or EPO, for example. The parent biological drug will have been through extensive and expensive clinical trials to ensure its safety and clinical efficacy in as many patients as possible. It is important to establish that the biosimilar copy has the same safety profile and clinical efficacy.
	For most biosimilar drugs, extensive clinical trials will be necessary to establish the drug in the marketplace, although in most cases they will not be as extensive as those for the parent drug. A biosimilar drug costs in the region of 5 million to 20 million to develop, compared with 500,000 to 1 million for a generic drug, with a timeline similar to the development of the parent biological drug. Savings to the NHS will be in the region of 10 to 20 per cent. However, because biological drugs are more expensive than conventional drugs, that could be a considerable overall saving to the NHS.
	At present, biological drugs are mainly used in a hospital setting, but it is expected that they will be prescribed in future by general practitioners and dispensed by community pharmacists. Currently used biological drugs include insulins, interferons, recombinant factor VIII, erythropoietins, growth hormones and granulocyte colony-stimulating factors, or G-CSF. Erythropoietins are used to treat the radiation-induced anaemia suffered by many cancer patients and to treat anaemia caused by chronic kidney disease. They are made in Chinese hamster ovaries. G-CSF is a hormone that stimulates white blood cell production and its use allows the dose of a chemotherapeutic agent to be increased.
	Whereas approval for generic drugs is the responsibility of each member state, the European Medicines Agency, or EMEA, is responsible for approving biosimilar drugs throughout the European Union. The term biosimilar drug is preferred by both the EMEA and the Medicines and Healthcare Products Regulatory Agency, the MHRA, as distinct from the term biogeneric drug, which some manufacturers would prefer to use. By October 2007, eight biosimilar drugs had been approved by the EMEA.
	On 7 November last year, I chaired a panel of parliamentarians from both Houses of Parliament to take evidence on biosimilar drugs and the implications of making them available to patients in the United Kingdom. We gathered evidence from seven individuals from the biotechnology industry, the medical and legal professions and the Patients Association, all with a close interest in this area of medicine. On 20 December last year, a report was published entitled, Introduction of Biosimilars: Review of the Issues, which has been widely circulated to those with an interest in health policy both within Parliament and outside. As a result of our deliberations, we made 12 recommendations, which I now want to summarise.
	We recommended that biological drugs, whether the parent drug or a biosimilar, should be prescribed by the doctor and dispensed by a pharmacist only by their brand names, not by their international non-proprietary names, or INNs. It is preferable, in our opinion, for a patient to be established on one biological drug by their doctor and for the patient to remain on that drug for the duration of their treatment unless adverse drug reactions are noticed. Several countries, including France, Spain, the Netherlands and Norway, have already introduced legislation and measures to prevent automatic substitution of biological drugs.
	We recommended that an urgent ban on substitution should be put in place in the UK until effective safeguards can be relied on. With the existing pharmacovigilance systems, it may not be possible to distinguish accurately or trace precisely the product dispensed by the pharmacist to the patient should they suffer an adverse drug reaction. The European Commission responsible for pharmaceuticals has written to all regulatory agencies in member countries outlining a need to improve their pharmacovigilance systems in order to ensure that the arrival of biosimilar drugs such as the erythropoietins are monitored closely for adverse drug reactions.
	A problem being addressed by regulators such as the World Health Organisation is the nomenclature of biosimilar drugs in order that an adverse drug reaction can be attributed to the right biosimilar product, its manufacturer and even the right batch number. Up to eight erythropoietic agents are now in existence. Until recently, only one was in useepoetin alphawhich comes as a formulation under the brand name Eprex. There are now three different versions of epoetin alpha alone. The European Commission has approved four other formulations: erythropoietin beta; Darbepoietin; Mircera, which is a pegylated formulation; and erythropoietin delta. Other formulations are pending approval. Obviously, it is important that a nomenclature system is established which allows professionals and patients to differentiate between different versions of what is essentially the same drug.
	The MHRA's black triangle symbol is applied to drugs that are new to the market and denotes a product that should be intensively monitored for adverse drug reactions by the MHRA and the Commission on Human Medicines, and to confirm the risk-benefit profile. We recommended that a black triangle symbol should be applied to all biosimilar drugs and that, at two-year or other periodic review, that symbol should remain unless the safety evidence is clear that it can be removed.
	The British National Formularythe BNFprovides doctors with information on prescribing drugs and on their pharmacology. We recommended that the BNF should flag biosimilar drugs with a black triangle and emphasised that clinician choice should be exercised in prescribing them. I am pleased to report that the BNF acted on this recommendation last month.
	It is even more important for biosimilars that pharmacovigilance is strengthened, as well as the yellow card scheme for reporting adverse drug reactions that the patient may suffer. There has been criticism of the effectiveness of the current voluntary yellow card scheme, under-reporting being a serious concern, and the MHRA is committed to increasing overall reporting of adverse drug reactions. I understand that an expert group of the Commission on Human Medicines is advising on this issue at the present time.
	An example of the possible risks that can arise from prescribing biosimilar drugs arose in the use of erythropoietins. A small change in the manufacturing process used by one company caused a significant and major adverse drug reaction known as pure red cell aplasia, which is a type of anaemia affecting the precursors to red blood cells but not to white blood cells. The bone marrow of a patient with this condition, which is an auto-immune disease, stops producing red blood cells. The company picked up that adverse drug reaction through its post-marketing surveillance, it acted responsibly, and it traced and arranged treatment for the patients who had received the affected batch of product all around the world.
	The summary of medicinal product characteristics, product packaging and patient information leaflet should include details of biosimilar formulation and manufacture for all biosimilar drugs, and reference should be made to the possible dangers of substitution of those products. That should provide clinicians, pharmacists and patients with clear information on biosimilar drugs and the added importance of reporting adverse drug reactions.
	We have recommended that Government agencies begin a consultation period with all professional organisations that represent clinicians, nurses and others, especially the royal colleges, which are involved in the purchasing and prescribing of biosimilar drugs. Those organisations, in turn, should be tasked with educating their memberships. A publicity campaign should be launched to raise public awareness of the risks of the substitution of biological drugs, and patients should be actively encouraged to monitor and report to their doctor any adverse drug reactions that they may experience.
	Knowledge about biosimilar drugs is extremely limited among the general public, which is one reason why I applied for this Adjournment debate. I hope that it will help to raise awareness of this subject, particularly among parliamentarians. The International Alliance of Patients Organisations has launched an educational programme on biosimilar drugs to help patient organisations make informed judgments on their value and on the scientific, social, ethical and economic issues involved. The use of such products is low at this time and fewalthough perhaps seriousadverse drug reactions will be reported in the initial stages of their use. Therefore, we have recommended that a European-wide database should be established to audit adverse drug reactions that may be associated with biosimilar drugs.
	Finally, we have also recommended that our findings on biosimilar drugs should be made available to the relevant authorities in the devolved nations of this country.
	In conclusion, I hope that I have demonstrated that biosimilar drugs must not be regarded by Governments as equivalent products to generic drugs, and that we need to establish different monitoring regimes to ensure patient safety in their use. It is a privilege that my right hon. Friend the Minister of State is here this evening and I look forward to her response.

Dawn Primarolo: I congratulate my hon. Friend the Member for Bolton, South-East (Dr. Iddon) on securing tonight's Adjournment debate. The depth and breadth of his knowledge on this important subject are clear. I am grateful to him for sending me a copy of his panel's report, and I look forward to discussing it with him in due course.
	I welcome the opportunity to clarify the general regulatory position on biosimilar medicinesa regulatory framework that already delivers much of what is suggested in the report. Biotechnology is an important and growing field within modern medicine, and the United Kingdom is home to an innovative biotechnology industry that makes a significant contribution to the development of new medicines, to the economy as a whole and to the research capacity of this country.
	My hon. Friend gave examples of biological medicines that help in the treatment of some very serious diseases. They make a crucial contribution to modern health care. Innovative medicines benefit from a period of data protection, but when they reach patent expiry, generic copiesbiosimilar medicinesare allowed by law. Properly licensed biosimilar medicines increase the number of such drugs available to patients and clinicians. Biosimilar medicines are manufactured following the same robust quality standards as for all other medicines but, as my hon. Friend pointed out, the complex nature of biological medicines requires careful testing and specialised control of production processes. Owing to the complex method of production of biological medicines, the active substance may differ slightly from the biological reference and the biosimilar medicine.
	It is important that those additional factors are fully taken into account when biosimilar medicines are manufactured and assessed. That is why special European regulations are in place to ensure that biosimilar manufacturers supply comprehensive data to regulators to demonstrate the safety, quality and efficacy of the product and its similarity to the original reference medicinal product. Regulatory authorities also perform periodic inspections of the manufacturing process.
	I note my hon. Friend's concerns about best practice guidance to promote brand prescribing and prevent automatic substitution of biosimilar medicines by pharmacies, and the use of the black triangle notification in the British National Formularythe BNF. I agree that it is important that those procedures are designed to safeguard best practice and offer proper patient protection. Several initiatives are under way to ensure that we can effectively monitor the safety of the biosimilar products on the market.
	We are working with other European regulatory authorities to ensure that health professionals who report adverse reactions to biosimilar products know that they should provide the brand name and batch number of the suspected product. We are also making it clear that marketing authorisation holders and regulatory authorities throughout the EU should directly contact reporters for that information if it is not provided in the initial report.
	It is the existing policy and current practice of the Medicines and Healthcare products Regulatory Agency to apply the black triangle symbol to all new medicinal products, including biosimilar medicines, for the first two years of marketing. The symbol denotes intensive monitoring of the new product and encourages reporting of all suspected adverse reactions through the yellow card scheme. After two years, the product's safety profile is reviewed and decisions are made about whether the intensive monitoring can be lifted.
	My hon. Friend raised concerns this evening about the under-use of the yellow card scheme for reporting adverse reactions. The MHRA works continuously to increase the number of reports received through the schemes from patients and health care professionals. There has recently been a promotion in community pharmacies to raise awareness of the yellow card scheme among medicine users. The MHRA has just launched an updated online reporting form, which makes it easier and quicker to submit reports of suspected adverse reactions.
	Biosimilar medicines are not identical copies of reference products, and therefore subtle differences may exist which may make a difference to their effect or side effects when taken by patients. It is preferable that, when such products are prescribed, they should be clearly identified and prescribed by brand name to ensure that the patient receives the exact product prescribed and that its safety in use can be properly monitored.
	The MHRA encourages companies that manufacture biosimilar medicines to give them a brand name so that there is no possibility of the pharmacist substituting another biosimilar product when dispensing a prescription. I note my hon. Friend's concern that pharmacists may automatically substitute biosimilar medicines for prescribed, branded products. It is important to stress that UK medicines legislation does not allow such substitution of a named brand product with any other without first agreeing that with the prescriber. There is no concrete evidence that substitution is happening. If my hon. Friend has any, or it is in his report, I would be interested in considering it.
	The Royal Pharmaceutical Society of Great Britain advises pharmacists that, except in an emergency, a specifically named innovator biological medicine should not be substituted with any other biosimilar medicine without the approval of the patient, carer, prescriber and, in the case of hospital drugs, the therapeutics committee or in line with other, similar, locally agreed protocols.
	The February edition of the MHRA bulletin for health professionals, Drug Safety Update, carried an article on biosimilar products. The article emphasised that it is good practice to prescribe biological products using the brand name, to ensure that a substitution of a biosimilar product by the pharmacist does not occur. The article also highlighted the need for reporters to use a specific brand name when reporting an adverse reaction to a biological product, to ensure that the reaction is assigned to the appropriate product.
	I hope that that briefly explains the general regulatory provisions. As my hon. Friend said at the beginning of his contribution, he chaired a panel considering the measures and a report has now been produced. The issue is vital. I look forward to discussions in due course with representatives of the panel and my right hon.or rather, my hon. Friend, whom I nearly promotedon the contents of that report and any further action that should be necessary.
	 Question put and agreed to.
	 Adjourned accordingly at nine minutes to Eight o'clock.

Deferred Division

Banking (S.I., 2008, No. 432)

That an humble Address be presented to Her Majesty, praying that the Northern Rock plc Transfer Order 2008 (S.I., 2008, No. 432), dated 21st February 2008, a copy of which was laid before this House on 21st February, be annulled.
	 The House divided: Ayes 124, Noes 322.

Question accordingly negatived.